[ { "id": "https://authors.library.caltech.edu/records/2rkwb-h1p23", "eprint_id": 102151, "eprint_status": "archive", "datestamp": "2023-08-19 10:54:29", "lastmod": "2023-10-19 23:53:44", "type": "monograph", "metadata_visibility": "show", "creators": { "items": [ { "id": "Chapman-J", "name": { "family": "Chapman", "given": "Jonathan" } }, { "id": "Dean-M", "name": { "family": "Dean", "given": "Mark" } }, { "id": "Ortoleva-P", "name": { "family": "Ortoleva", "given": "Pietro" } }, { "id": "Snowberg-E", "name": { "family": "Snowberg", "given": "Erik" } }, { "id": "Camerer-C-F", "name": { "family": "Camerer", "given": "Colin" }, "orcid": "0000-0003-4049-1871" } ] }, "title": "Econographics", "ispublished": "unpub", "full_text_status": "public", "keywords": "econographics, reciprocity, altruism, trust, costly third-party punishment, inequality aversion, risk aversion, common-ratio effect, endowment effect, ambiguity aversion, compound lottery aversion, discounting, overconfidence, cognitive ability, demographics", "note": "Written: Aug. 2018. Posted: 31 Oct 2018. \n\nCESifo Working Paper No. 7202. \n\nWe thank Douglas Bernheim, Benedetto De Martino, Stefano Della Vigna, Xavier Gabaix, Daniel Gottlieb, Eric Johnson, David Laibson, Graham Loomes, Ulrike Malmandier, Matthew Rabin, Peter Wakker, Michael Woodford, and the participants of seminars and conferences for their useful comments and suggestions. Daniel Chawla provided excellent research assistance. Camerer, Ortoleva, and Snowberg gratefully acknowledge the finanancial support of NSF Grant SMA-1329195.\n\n
Submitted - SSRN-id3239267.pdf
Submitted - SSRN-id3275375.pdf
", "abstract": "We study the pattern of correlations across a large number of behavioral regularities, with the goal of creating an empirical basis for more comprehensive theories of decision-making. We elicit 21 behaviors using an incentivized survey on a representative sample (n = 1;000) of the U.S. population. Our data show a clear and relatively simple structure underlying the correlations between these measures. Using principal components analysis, we reduce the 21 variables to six components corresponding to clear clusters of high correlations. We examine the relationship between these components, cognitive ability, and demographics, and discuss the theoretical implications of the structure we uncover.", "date": "2020-03-27", "date_type": "published", "publisher": "Caltech Library", "id_number": "CaltechAUTHORS:20200327-132527874", "official_url": "https://resolver.caltech.edu/CaltechAUTHORS:20200327-132527874", "rights": "No commercial reproduction, distribution, display or performance rights in this work are provided.", "funders": { "items": [ { "agency": "NSF", "grant_number": "SMA-1329195" } ] }, "other_numbering_system": { "items": [ { "id": "7202", "name": "CESifo Working Paper" } ] }, "primary_object": { "basename": "SSRN-id3275375.pdf", "url": "https://authors.library.caltech.edu/records/2rkwb-h1p23/files/SSRN-id3275375.pdf" }, "related_objects": [ { "basename": "SSRN-id3239267.pdf", "url": "https://authors.library.caltech.edu/records/2rkwb-h1p23/files/SSRN-id3239267.pdf" } ], "resource_type": "monograph", "pub_year": "2020", "author_list": "Chapman, Jonathan; Dean, Mark; et el." }, { "id": "https://authors.library.caltech.edu/records/82c2x-qjw11", "eprint_id": 102150, "eprint_status": "archive", "datestamp": "2023-08-19 11:27:39", "lastmod": "2023-10-19 23:53:40", "type": "monograph", "metadata_visibility": "show", "creators": { "items": [ { "id": "Chapman-J", "name": { "family": "Chapman", "given": "Jonathan" } }, { "id": "Snowberg-E", "name": { "family": "Snowberg", "given": "Erik" } }, { "id": "Wang-Stephanie-W", "name": { "family": "Wang", "given": "Stephanie" } }, { "id": "Camerer-C-F", "name": { "family": "Camerer", "given": "Colin" }, "orcid": "0000-0003-4049-1871" } ] }, "title": "Loss Attitudes in the U.S. Population: Evidence from Dynamically Optimized Sequential Experimentation (Dose)", "ispublished": "unpub", "full_text_status": "public", "keywords": "dynamic experiments, DOSE, loss aversion, risk preferences, time preferences", "note": "Written: September 13, 2018. Posted: 31 Oct 2018. \n\nCESifo Working Paper No. 7262. \n\nThanks to John Beshears, Mark Dean, Kate Johnson, Ian Krajbich, Andreas Krause, Pietro Ortoleva, Deb Ray, Antonio Rangel, Hans-Martin von Gaudecker, Peter Wakker, Nathaniel Wilcox, and the participants of seminars and conferences for their useful comments and suggestions. Judah Okwuobi and Michelle Filiba provided excellent research assistance. Camerer and Snowberg gratefully acknowledge the financial support of NSF Grant SMA1329195. This paper subsumes the earlier, largely methodological, working paper, \"Dynamically Optimized Sequential Experimentation (DOSE) for Estimating Economic Preference Parameters,\" (2010).\n\nSubmitted - SSRN-id3275438.pdf
", "abstract": "We introduce DOSE - Dynamically Optimized Sequential Experimentation - and use it to estimate individual-level loss aversion in a representative sample of the U.S. population (N = 2;000). DOSE elicitations are more accurate, more stable across time, and faster to administer than standard methods. We find that around 50% of the U.S. population is loss tolerant. This is counter to earlier findings, which mostly come from lab/student samples, that a strong majority of participants are loss averse. Loss attitudes are correlated with cognitive ability: loss aversion is more prevalent in people with high cognitive ability, and loss tolerance is more common in those with low cognitive ability. We also use DOSE to document facts about risk and time preferences, indicating a high potential for DOSE in future research.", "date": "2020-03-27", "date_type": "published", "publisher": "Caltech Library", "id_number": "CaltechAUTHORS:20200327-131600093", "official_url": "https://resolver.caltech.edu/CaltechAUTHORS:20200327-131600093", "rights": "No commercial reproduction, distribution, display or performance rights in this work are provided.", "funders": { "items": [ { "agency": "NSF", "grant_number": "SMA-1329195" } ] }, "other_numbering_system": { "items": [ { "id": "7262", "name": "CESifo Working Paper" } ] }, "primary_object": { "basename": "SSRN-id3275438.pdf", "url": "https://authors.library.caltech.edu/records/82c2x-qjw11/files/SSRN-id3275438.pdf" }, "resource_type": "monograph", "pub_year": "2020", "author_list": "Chapman, Jonathan; Snowberg, Erik; et el." }, { "id": "https://authors.library.caltech.edu/records/5zn4h-1m255", "eprint_id": 102148, "eprint_status": "archive", "datestamp": "2023-08-19 15:47:21", "lastmod": "2023-10-19 23:53:34", "type": "monograph", "metadata_visibility": "show", "creators": { "items": [ { "id": "Camerer-C-F", "name": { "family": "Camerer", "given": "Colin" }, "orcid": "0000-0003-4049-1871" }, { "id": "Linardi-S", "name": { "family": "Linardi", "given": "Sera" } } ] }, "title": "Robustness of Relational Contracts to Interruptions in Employer-Worker Gift Exchange Experiments", "ispublished": "unpub", "full_text_status": "public", "keywords": "experimental economics, gift exchange, relational contracts, behavioral economics", "note": "Date Written: May 5, 2019; Posted: 29 May 2019.\n\nSubmitted - SSRN-id3382951.pdf
", "abstract": "This paper experimentally investigates the robustness of the \"two-tiered labor market\" of Brown, Falk and Fehr (2004). In the experiments, relatively efficient private relational contracts emerge between firms and specific workers, as firms make worker-specific wage effors. Public contracts which any worker can accept are also made.. Robustness is tested by introducing stochastic interruptions in which firms cannot hire workers for three periods. Workers that are involuntarily laid off by the interruptions are eager to be reemployed; they are unselective about job offers and typically do not shirk. Firms prefer these laid-off \"temp workers\" to others who weren't laid off. Heightened job insecurity induces all workers to compete to enter relational contracts why delivering substantial effort close to the level requested by firms. The results show that interruptions may shorten relational contracts but do not harm market efficiency (except in the last few periods when there is more shirking). A simplified equilibrium model in which fair-minded and selfish workers both exist make several predictions about the nature of contracts and dynamics which are generally consistent with the evidence.", "date": "2020-03-27", "date_type": "published", "publisher": "SSRN Electronic Journal", "id_number": "CaltechAUTHORS:20200327-125903840", "official_url": "https://resolver.caltech.edu/CaltechAUTHORS:20200327-125903840", "rights": "No commercial reproduction, distribution, display or performance rights in this work are provided.", "doi": "10.2139/ssrn.3382951", "primary_object": { "basename": "SSRN-id3382951.pdf", "url": "https://authors.library.caltech.edu/records/5zn4h-1m255/files/SSRN-id3382951.pdf" }, "resource_type": "monograph", "pub_year": "2020", "author_list": "Camerer, Colin and Linardi, Sera" }, { "id": "https://authors.library.caltech.edu/records/raz82-rqx75", "eprint_id": 102149, "eprint_status": "archive", "datestamp": "2023-08-19 13:46:05", "lastmod": "2023-10-19 23:53:37", "type": "monograph", "metadata_visibility": "show", "creators": { "items": [ { "id": "Li-Xiaoming", "name": { "family": "Li", "given": "Xiaoming" } }, { "id": "Camerer-C-F", "name": { "family": "Camerer", "given": "Colin" }, "orcid": "0000-0003-4049-1871" } ] }, "title": "Using Visual Salience in Empirical Game Theory", "ispublished": "unpub", "full_text_status": "public", "keywords": "salience, focal points, coordination, neuroeconomic", "note": "Date Written: January 1, 2019; Posted: 11 Jan 2019. \n\nSupport was provided by the Behavioral and Neuroeconomics Discovery Fund (PI Camerer) and NIMH Conte Center P50MH094258. Thanks to audiences at the Caltech Graduate Proseminar, Sloan/NOMIS Conference on Decision and Cognition, IAREP/SABE (Middlesex), Columbia University, Peking University, Elke Weber and Vince Crawford for helpful comments, to Anne Karling for a valuable image, and to Eskil Forsell, Milica Moorman, Gidi Nave and Alec Smith for prior research on this topic.\n\nSubmitted - SSRN-id3308886.pdf
", "abstract": "Coordination games often have salient \"focal points\". In games where choices are locations in images, we test for the effect of salience, predicted a priori using a neuroscience-based algorithm, Concentration of salience is correlated with the rate of matching when players are trying to match (r=.64). In hider-seeker games, all players choose salient locations more often, creating a \"seeker's advantage\" (seekers win 9% of games). Salience-choice relations are explained by a salience-enhanced cognitive hierarchy model. The novel prediction that time pressure will increases seeker's advantage, by biasing choices toward salience, is confirmed. Other links to salience in economics are suggested.", "date": "2020-03-27", "date_type": "published", "publisher": "SSRN Electronic Journal", "id_number": "CaltechAUTHORS:20200327-130458883", "official_url": "https://resolver.caltech.edu/CaltechAUTHORS:20200327-130458883", "rights": "No commercial reproduction, distribution, display or performance rights in this work are provided.", "funders": { "items": [ { "agency": "Behavioral and Neuroeconomics Discovery Fund" }, { "agency": "NIH", "grant_number": "P50MH094258" } ] }, "doi": "10.2139/ssrn.3308886", "primary_object": { "basename": "SSRN-id3308886.pdf", "url": "https://authors.library.caltech.edu/records/raz82-rqx75/files/SSRN-id3308886.pdf" }, "resource_type": "monograph", "pub_year": "2020", "author_list": "Li, Xiaoming and Camerer, Colin" }, { "id": "https://authors.library.caltech.edu/records/19czg-pcg92", "eprint_id": 102152, "eprint_status": "archive", "datestamp": "2023-08-19 05:28:26", "lastmod": "2023-10-19 23:53:47", "type": "monograph", "metadata_visibility": "show", "creators": { "items": [ { "id": "Chapman-J", "name": { "family": "Chapman", "given": "Jonathan" } }, { "id": "Dean-M", "name": { "family": "Dean", "given": "Mark" } }, { "id": "Ortoleva-P", "name": { "family": "Ortoleva", "given": "Pietro" } }, { "id": "Snowberg-E", "name": { "family": "Snowberg", "given": "Erik" } }, { "id": "Camerer-C-F", "name": { "family": "Camerer", "given": "Colin" }, "orcid": "0000-0003-4049-1871" } ] }, "title": "Willingness to Pay and Willingness to Accept are Probably Less Correlated than You Think", "ispublished": "unpub", "full_text_status": "public", "keywords": "Willingness to Pay, Willingness to Accept, Endowment Effect, Loss Aversion, Risk Aversion", "note": "Date Written: October 2017. Posted: 23 Oct 2017. \n\nCESifo Working Paper Series No. 6492; NBER Working Paper No. w23954. \n\nWe thank Douglas Bernheim, Benedetto De Martino, Stefano Della Vigna, Eric Johnson, Graham Loomes, Jan Rivkin, Peter Wakker, Micheal Woodford, and the participants of seminars and conferences for their useful comments and suggestions. Evan Friedman and Khanh Ngoc Han Huynh provided research assistance. Camerer, Ortoleva, and Snowberg gratefully acknowledge the financial support of NSF Grant SMA-1329195. The views expressed herein are those of the authors and do not necessarily reflect the views of the National Bureau of Economic Research.\n\nSubmitted - SSRN-id2988958.pdf
Submitted - SSRN-id3057185.pdf
", "abstract": "An enormous literature documents that willingness to pay (WTP) is less than willingness to accept (WTA) a monetary amount for an object, a phenomenon called the endowment effect. Using data from an incentivized survey of a representative sample of 3,000 U.S. adults, we add one (probably) surprising additional finding: WTA and WTP for a lottery are, at best, slightly correlated. Across all respondents, the correlation is slightly negative. A meta-study of published experiments with university students shows a correlation of around 0.15--0.2, consistent with the correlation in our data for high-IQ respondents. While poorly related to each other, WTA and WTP are closely related to different measures of risk aversion, and relatively stable across time. We show that the endowment effect is not related to individual-level measures of loss aversion, counter to Prospect Theory or Stochastic Reference Dependence.", "date": "2020-03-27", "date_type": "published", "publisher": "Caltech Library", "id_number": "CaltechAUTHORS:20200327-133526209", "official_url": "https://resolver.caltech.edu/CaltechAUTHORS:20200327-133526209", "rights": "No commercial reproduction, distribution, display or performance rights in this work are provided.", "funders": { "items": [ { "agency": "NSF", "grant_number": "SMA-1329195" } ] }, "other_numbering_system": { "items": [ { "id": "w23954", "name": "NBER Working Paper" } ] }, "primary_object": { "basename": "SSRN-id2988958.pdf", "url": "https://authors.library.caltech.edu/records/19czg-pcg92/files/SSRN-id2988958.pdf" }, "related_objects": [ { "basename": "SSRN-id3057185.pdf", "url": "https://authors.library.caltech.edu/records/19czg-pcg92/files/SSRN-id3057185.pdf" } ], "resource_type": "monograph", "pub_year": "2020", "author_list": "Chapman, Jonathan; Dean, Mark; et el." }, { "id": "https://authors.library.caltech.edu/records/w98sq-h2k05", "eprint_id": 102074, "eprint_status": "archive", "datestamp": "2023-08-22 04:24:05", "lastmod": "2023-10-19 23:48:26", "type": "monograph", "metadata_visibility": "show", "creators": { "items": [ { "id": "Edmunds-C-E-R", "name": { "family": "Edmunds", "given": "C. E. R." } }, { "id": "Bose-D", "name": { "family": "Bose", "given": "Devdeepta" } }, { "id": "Camerer-C-F", "name": { "family": "Camerer", "given": "Colin F." }, "orcid": "0000-0003-4049-1871" }, { "id": "Mullett-T-L", "name": { "family": "Mullett", "given": "Timothy L." } }, { "id": "Stewart-N", "name": { "family": "Stewart", "given": "Neil" } } ] }, "title": "Accumulation is late and brief in preferential choice", "ispublished": "unpub", "full_text_status": "public", "keywords": "drift diffusion model; modeling; value-based choice", "note": "License: CC-By Attribution 4.0 International. \n\nWe acknowledge Economic and Social Research Council grants ES/N018192/1 and ES/P008976/1. \n\nThe authors declare that they have no competing financial interests.\n\nSubmitted - 10.31234-osf.io-sa4zr.pdf
", "abstract": "Preferential choices are often explained using models within the evidence accumulation framework: value drives the drift rate at which evidence is accumulated until a threshold is reached and an option is chosen. Although rarely stated explicitly, almost all such models assume that decision makers have knowledge at the onset of the choice of all available attributes and options. In reality however, choice information is viewed piece-by-piece, and is often not completely acquired until late in the choice, if at all. Across four eye-tracking experiments, we show that whether the information was acquired early or late is irrelevant in predicting choice: all that matters is whether or not it was acquired at all. Models with potential alternative assumptions were posited and tested, such as 1) accumulation of instantaneously available information or 2) running estimates as information is acquired. These provided poor fits to the data. We are forced to conclude that participants either are clairvoyant, accumulating using information before they have looked at it, or delay accumulating evidence until very late in the choice, so late that the majority of choice time is not time in which evidence is accumulated. Thus, although the evidence accumulation framework may still be useful in measurement models, it cannot account for the details of the processes involved in decision making.", "date": "2020-03-24", "date_type": "published", "id_number": "CaltechAUTHORS:20200324-085240408", "official_url": "https://resolver.caltech.edu/CaltechAUTHORS:20200324-085240408", "rights": "No commercial reproduction, distribution, display or performance rights in this work are provided.", "funders": { "items": [ { "agency": "Economic and Social Research Council (ESRC)", "grant_number": "ES/N018192/1" }, { "agency": "Economic and Social Research Council (ESRC)", "grant_number": "ES/P008976/1" } ] }, "local_group": { "items": [ { "id": "Tianqiao-and-Chrissy-Chen-Institute-for-Neuroscience" } ] }, "doi": "10.31234/osf.io/sa4zr", "primary_object": { "basename": "10.31234-osf.io-sa4zr.pdf", "url": "https://authors.library.caltech.edu/records/w98sq-h2k05/files/10.31234-osf.io-sa4zr.pdf" }, "resource_type": "monograph", "pub_year": "2020", "author_list": "Edmunds, C. E. R.; Bose, Devdeepta; et el." }, { "id": "https://authors.library.caltech.edu/records/pzcef-gxe48", "eprint_id": 100791, "eprint_status": "archive", "datestamp": "2023-08-19 21:54:37", "lastmod": "2023-10-18 21:52:10", "type": "monograph", "metadata_visibility": "show", "creators": { "items": [ { "id": "Ray-D", "name": { "family": "Ray", "given": "Debajyoti" } }, { "id": "Golovin-D", "name": { "family": "Golovin", "given": "Daniel" } }, { "id": "Krause-A", "name": { "family": "Krause", "given": "Andreas" }, "orcid": "0000-0001-7260-9673" }, { "id": "Camerer-C-F", "name": { "family": "Camerer", "given": "Colin" }, "orcid": "0000-0003-4049-1871" } ] }, "title": "Bayesian Rapid Optimal Adaptive Design (BROAD): Method and application distinguishing models of risky choice", "ispublished": "unpub", "full_text_status": "public", "note": "Submitted to Econometrica.\n\nSubmitted - Econ_EC2.pdf
", "abstract": "Economic surveys and experiments usually present fixed questions to respondents. Rapid computation now allows adaptively optimized questions, based on previous responses, to maximize expected information. We describe a novel method of this type introduced in computer science, and apply it experimentally to six theories of risky choice. The EC\u00b2 method creates equivalence classes, each consisting of a true theory and its noisy-response perturbations, and chooses questions with the goal of distinguishing between equivalence classes by cutting edges connecting them. The edge-cutting information measure is adaptively submodular, which enables a provable performance bound and lazy evaluation which saves computation. The experimental data show that most subjects, making only 30 choices, can be reliably classified as choosing according to EV or two variants of prospect theory. We also consider whether subjects should and could manipulate by misreporting preferences, and find little evidence of manipulation.", "date": "2020-01-17", "date_type": "published", "id_number": "CaltechAUTHORS:20200117-110441501", "official_url": "https://resolver.caltech.edu/CaltechAUTHORS:20200117-110441501", "rights": "No commercial reproduction, distribution, display or performance rights in this work are provided.", "doi": "10.31219/osf.io/utvbz", "primary_object": { "basename": "Econ_EC2.pdf", "url": "https://authors.library.caltech.edu/records/pzcef-gxe48/files/Econ_EC2.pdf" }, "resource_type": "monograph", "pub_year": "2020", "author_list": "Ray, Debajyoti; Golovin, Daniel; et el." }, { "id": "https://authors.library.caltech.edu/records/6jw6k-stw51", "eprint_id": 94621, "eprint_status": "archive", "datestamp": "2023-08-19 09:30:45", "lastmod": "2023-10-20 18:07:09", "type": "monograph", "metadata_visibility": "show", "creators": { "items": [ { "id": "Camerer-C-F", "name": { "family": "Camerer", "given": "Colin F." }, "orcid": "0000-0003-4049-1871" }, { "id": "Ho-Teck-Hua", "name": { "family": "Ho", "given": "Teck H." }, "orcid": "0000-0001-5210-4977" }, { "id": "Chong-Juin-Kuan", "name": { "family": "Chong", "given": "Juin-Kuan" }, "orcid": "0000-0002-5187-8652" }, { "id": "Weigelt-Keith", "name": { "family": "Weigelt", "given": "Keith" } } ] }, "title": "Strategic Teaching and Equilibrium Models of Repeated Trust and Entry Games", "ispublished": "unpub", "full_text_status": "public", "note": "This research was supported by NSF grant SES-0078911. Thanks to John Kagel for rapidly supplying data and to Drew Fudenberg, Qi-Zheng Ho, David Hsia, Xin Wang, and two referees for discussions and help. Useful comments were received from seminar participants at Berkeley, Caltech, Chicago, Harvard, Hong Kong UST, New York University, Pittsburgh, Princeton, and Wharton.\n\nAccepted Version - fewarevision.pdf
", "abstract": "This paper tests a model of strategic teaching in repeated trust and entry games with incomplete information. The model assumes 'short-run' players follow a one-parameter learning model (functional experience-weighted attraction). 'Long-run' players either realize how others are learning and 'teach' by maximizing their long-run payoff, or always behave honestly or aggressively. For precision, the fraction of honest/aggressive types was first measured in an experiment with one-shot games. Using data from 28 experimental sessions of eight-period trust and entry supergames (25,000 observations), the model fits modestly better than a quantal-response equilibrium benchmark, and both models predict much more accurately than chance. Estimates show most players are sophisticated, and become more sophisticated with experience. Direct measures of subjects' beliefs are weakly correlated with implicit model beliefs, but are extremely accurate and do not show the overconfidence found in many psychological studies.", "date": "2019-04-10", "date_type": "published", "publisher": "California Institute of Technology", "id_number": "CaltechAUTHORS:20190410-115224722", "official_url": "https://resolver.caltech.edu/CaltechAUTHORS:20190410-115224722", "rights": "No commercial reproduction, distribution, display or performance rights in this work are provided.", "funders": { "items": [ { "agency": "NSF", "grant_number": "SES-0078911" } ] }, "primary_object": { "basename": "fewarevision.pdf", "url": "https://authors.library.caltech.edu/records/6jw6k-stw51/files/fewarevision.pdf" }, "resource_type": "monograph", "pub_year": "2019", "author_list": "Camerer, Colin F.; Ho, Teck H.; et el." }, { "id": "https://authors.library.caltech.edu/records/y3wa8-v3914", "eprint_id": 83580, "eprint_status": "archive", "datestamp": "2023-08-19 04:12:21", "lastmod": "2024-01-14 19:14:30", "type": "monograph", "metadata_visibility": "show", "creators": { "items": [ { "id": "Camerer-C-F", "name": { "family": "Camerer", "given": "Colin F." }, "orcid": "0000-0003-4049-1871" }, { "id": "Hogarth-R-M", "name": { "family": "Hogarth", "given": "Robin M." } } ] }, "title": "The Effects of Financial Incentives in Experiments: A Review and Capital-Labor-Production Framework", "ispublished": "unpub", "full_text_status": "public", "note": "Very helpful comments were received from Baruch Fischhoff, Reid Hastie, John Kagel, Daniel Kahneman, George Loewenstein, Rob MacCoun, Chuck Manski, Richard Thaler, two anonymous referees, and many participants in the NSF/Berkeley Econometrics Lab conference on elicitation of preferences, July/August 1997. Angela Hung provided meticulous research assistance. \n\nPublished as Camerer, Colin F. and Hogarth, Robin M. (1999) The Effects of Financial Incentives in Experiments: A Review and Capital-Labor-Production Framework. Journal of Risk and Uncertainty, 19 (1-3). pp. 7-42.\n\nSubmitted - sswp1059.pdf
", "abstract": "We review 74 experiments with no, low, or high performance-based financial incentives. The modal result has no effect on mean performance (though variance is usually reduced by higher payment). Higher incentive does improve performance often, typically judgment tasks that are responsive to better effort. Incentives also reduce \"presentation\" effects (e.g., generosity and risk-seeking). Incentive effects are comparable to effects of other variables, particularly \"cognitive capital\" and task \"production\" demands, and interact with those variables, so a narrow-minded focus on incentives alone is misguided. We also note that no replicated study has made rationality violations disappear purely by raising incentives.", "date": "2017-11-30", "date_type": "published", "publisher": "California Institute of Technology", "id_number": "CaltechAUTHORS:20171129-161418280", "official_url": "https://resolver.caltech.edu/CaltechAUTHORS:20171129-161418280", "rights": "No commercial reproduction, distribution, display or performance rights in this work are provided.", "local_group": { "items": [ { "id": "Social-Science-Working-Papers" } ] }, "doi": "10.7907/y3wa8-v3914", "primary_object": { "basename": "sswp1059.pdf", "url": "https://authors.library.caltech.edu/records/y3wa8-v3914/files/sswp1059.pdf" }, "resource_type": "monograph", "pub_year": "2017", "author_list": "Camerer, Colin F. and Hogarth, Robin M." }, { "id": "https://authors.library.caltech.edu/records/x4p85-xjv36", "eprint_id": 82955, "eprint_status": "archive", "datestamp": "2023-08-19 11:56:56", "lastmod": "2024-01-14 05:49:14", "type": "monograph", "metadata_visibility": "show", "creators": { "items": [ { "id": "Kovalchik-S", "name": { "family": "Kovalchik", "given": "Stephanie" } }, { "id": "Camerer-C-F", "name": { "family": "Camerer", "given": "Colin F." }, "orcid": "0000-0003-4049-1871" }, { "id": "Grether-D-M", "name": { "family": "Grether", "given": "David M." } }, { "id": "Plott-C-R", "name": { "family": "Plott", "given": "Charles R." } }, { "id": "Allman-J-M", "name": { "family": "Allman", "given": "John M." } } ] }, "title": "Aging and decision making: A comparison between neurologically healthy elderly and young individuals", "ispublished": "unpub", "full_text_status": "public", "keywords": "Age, overconfidence, willingness to pay/accept, endowment effect, theory of mind, game theory, risk-taking", "note": "We thank Dr. Gail Murdock and Dr. Linda Clark, from the ADRC, who coordinated the recruitment of the older population and provided demographic data for these subjects. We also thank Kathy Zeiler for her assistance with the loss aversion methodology, as well as Neda Afsarmanesh for her involvement in the questionnaire\ndesign. The financial support of the National Science Foundation, the Summer Undergraduate Research Fellowship at the California Institute of Technology, the Arthur\nR. Adams Fellowship, and the David and Lucile Packard Foundation are gratefully\nacknowledged.\nFor their reading of and helpful responses to early versions of our paper, we thank\nDr. John Conlisk and our article's anonymous referee.\n14\n\nSubmitted - sswp1180.pdf
", "abstract": "We report the results of experiments on economic decisions with two populations,\none of healthy elderly individuals (average age 82) and one of younger students (average\nage 20). We examine confidence, decisions under uncertainty, differences between\nwillingness to pay and willingness to accept and the theory of mind (strategic thinking).\nOur findings indicate that the older adults' decision behavior is similar to that of young\nadults, contrary to the notion that economic decision making is impaired with age.\nChoices over lotteries do not reflect the age differences previously reported in the\npsychology and biology literature. Moreover, some of the demonstrated decision\nbehaviors suggest that the elderly individuals are less biased than the younger\nindividuals.(1)There is a greater prevalence of overconfident behavior in the younger\npopulation. (2) Our results show no significant support for a theory of an endowment\neffect in either population. (3) Both populations perform similarly on the beauty contest\ntask, although there is a modest indication of a higher incidence of confused behavior by\nthe older.", "date": "2017-11-06", "date_type": "published", "publisher": "California Institute of Technology", "id_number": "CaltechAUTHORS:20171103-153904140", "official_url": "https://resolver.caltech.edu/CaltechAUTHORS:20171103-153904140", "rights": "No commercial reproduction, distribution, display or performance rights in this work are provided.", "funders": { "items": [ { "agency": "NSF" }, { "agency": "Caltech Summer Undergraduate Research Fellowship (SURF)" }, { "agency": "Arthur R. Adams Fellowship" }, { "agency": "David and Lucile Packard Foundation" } ] }, "local_group": { "items": [ { "id": "Social-Science-Working-Papers" } ] }, "doi": "10.7907/x4p85-xjv36", "primary_object": { "basename": "sswp1180.pdf", "url": "https://authors.library.caltech.edu/records/x4p85-xjv36/files/sswp1180.pdf" }, "resource_type": "monograph", "pub_year": "2017", "author_list": "Kovalchik, Stephanie; Camerer, Colin F.; et el." }, { "id": "https://authors.library.caltech.edu/records/hfg50-nkp96", "eprint_id": 82999, "eprint_status": "archive", "datestamp": "2023-08-19 05:13:10", "lastmod": "2024-01-14 05:49:20", "type": "monograph", "metadata_visibility": "show", "creators": { "items": [ { "id": "Camerer-C-F", "name": { "family": "Camerer", "given": "Colin F." }, "orcid": "0000-0003-4049-1871" }, { "id": "Knez-M", "name": { "family": "Knez", "given": "Mark" } } ] }, "title": "Increasing Cooperation in Prisoner's Dilemmas by Establishing a Precedent of Efficiency in Coordination", "ispublished": "unpub", "full_text_status": "public", "note": "Helpful comments were received from Ron Burt, James Coleman, Chip Heath, Rod Kramer, one referee and both editors, participants at the Stanford GSB conference on Strategy and Organization, October 1994, and participants at the University of Chicago GSB Social Organization of Competition Workshop, January 24, 1995. \n\nPublished as Knez, Marc and Camerer, Colin (2000) Increasing Cooperation in Prisoner's Dilemmas by Establishing a Precedent of Efficiency in Coordination Games. Organizational Behavior and Human Decision Processes, 82 (2). pp. 194-216.\n\nSubmitted - sswp1080.pdf
", "abstract": "Coordination games have multiple Nash equilibria (i.e., sets of strategies which are best responses\nto one another). In ``weak-link\" coordination games players choose a number 1-7. Their payoff is\nincreasing in the minimum number (or weakest link) and decreasing in the difference between\ntheir number and the minimum. Choosing 7 is an ``efficient\" equilibrium because it gives\neverybody a higher payoff than any other coordinated choice. Higher-payoff equilibria are riskier,\nhowever, so the game expresses the tradeoff between group efficiency and personal risk present\nin many social and organizational settings. We tested whether choosing efficiently in a weak-link\ngame increases cooperative play in a subsequent prisoner's dilemma (PD) game. This cross-game\ntransfer resembles transfer of cooperative norms in small firms (which are more like coordination\ngames than PDs) as firms grow larger and become like PDs. In two experiments, if a group of\nplayers share a history of playing the weak-link game efficiently, that efficiency precedent can\ntransfer to a subsequent PD game, improving the level of cooperativeness. The effect of transfer\nis much larger in magnitude (increasing cooperation from 15-30% to 71%) than the effects of\nmost variables in previous PD studies. However, the transfer effect depends on descriptive\nsimilarity of strategies in the two games, since it largely disappears when the strategies are\nnumbered differently in the weak-link game and the PD.", "date": "2017-11-06", "date_type": "published", "publisher": "California Institute of Technology", "id_number": "CaltechAUTHORS:20171106-144605221", "official_url": "https://resolver.caltech.edu/CaltechAUTHORS:20171106-144605221", "rights": "No commercial reproduction, distribution, display or performance rights in this work are provided.", "local_group": { "items": [ { "id": "Social-Science-Working-Papers" } ] }, "doi": "10.7907/hfg50-nkp96", "primary_object": { "basename": "sswp1080.pdf", "url": "https://authors.library.caltech.edu/records/hfg50-nkp96/files/sswp1080.pdf" }, "resource_type": "monograph", "pub_year": "2017", "author_list": "Camerer, Colin F. and Knez, Mark" }, { "id": "https://authors.library.caltech.edu/records/p6hm5-2gb95", "eprint_id": 81052, "eprint_status": "archive", "datestamp": "2023-08-19 22:49:00", "lastmod": "2024-01-14 05:23:09", "type": "monograph", "metadata_visibility": "show", "creators": { "items": [ { "id": "Banks-J-S", "name": { "family": "Banks", "given": "Jeffrey S." } }, { "id": "Camerer-C-F", "name": { "family": "Camerer", "given": "Colin F." }, "orcid": "0000-0003-4049-1871" }, { "id": "Porter-D-P", "name": { "family": "Porter", "given": "David" } } ] }, "title": "An Experimental Analysis of Nash Refinements in Signaling Games", "ispublished": "unpub", "full_text_status": "public", "keywords": "Game Theory, Nash Refinements, Experimental Economics, Signaling Games", "note": "We are indebted to Mark Olson for help in statistical analysis and programming. Audiences at Washington University, University of Arizona, University of Houston, and University of Pennsylvania provided helpful comments. This research was partially funded by the Wharton Risk and Decision Processes Center. Support for the second author was provided by the National Science Foundation (SES 87-08566).\n\nPublished as Banks, Jeffrey and Camerer, Colin and Porter, David (1994) An Experimental Analysis of Nash Refinements in Signaling Games. Games and Economic Behavior, 6 (1). pp. 1-31.\n\nSubmitted - sswp740.pdf
", "abstract": "This paper investigates the refinements of Nash equilibrium in two person signaling game experiments. The experimental games cover the watershed of the nested refinements: Bayes-Nash, Sequential, Intuitive, Divine, Universally Divine, NWBR, and Stabel. In each game an equilibrium selection problem is defined in which adjacent refinements are considered.\nThe pattern of outcomes suggest that individuals select the more refined equilibria up to the divinity concept. However, an anomaly occurs in the game in which the stable equilibrium is a clear preference among the subjects. Since the concepts are nested this suggests that the outcomes are game specific. Sender behavior does not seem to follow any specific decision rule (e.g., Nash, minmax, PIR, etc.) while receiver actions tend to correspond to the Nash equilibrium outcomes.", "date": "2017-09-01", "date_type": "published", "publisher": "California Institute of Technology", "id_number": "CaltechAUTHORS:20170831-160114059", "official_url": "https://resolver.caltech.edu/CaltechAUTHORS:20170831-160114059", "rights": "No commercial reproduction, distribution, display or performance rights in this work are provided.", "funders": { "items": [ { "agency": "NSF", "grant_number": "SES-8708566" }, { "agency": "Wharton Risk and Decision Processes Center" } ] }, "local_group": { "items": [ { "id": "Social-Science-Working-Papers" } ] }, "doi": "10.7907/p6hm5-2gb95", "primary_object": { "basename": "sswp740.pdf", "url": "https://authors.library.caltech.edu/records/p6hm5-2gb95/files/sswp740.pdf" }, "resource_type": "monograph", "pub_year": "2017", "author_list": "Banks, Jeffrey S.; Camerer, Colin F.; et el." }, { "id": "https://authors.library.caltech.edu/records/hnsrp-4yw45", "eprint_id": 80576, "eprint_status": "archive", "datestamp": "2023-09-15 05:46:23", "lastmod": "2024-01-14 05:08:46", "type": "monograph", "metadata_visibility": "show", "creators": { "items": [ { "id": "Camerer-C-F", "name": { "family": "Camerer", "given": "Colin F." }, "orcid": "0000-0003-4049-1871" } ] }, "title": "Rules for Experimenting in Psychology and Economics, and Why They Differ", "ispublished": "unpub", "full_text_status": "public", "keywords": "Experimental economics, psychology, bounded rationality.", "note": "Comments from participants at the Big Ten Accounting Doctoral Consortium, Minneapolis 5/13-15/94, Chip Heath, Wulf Albers, and Werner Guth, were helpful. Many conversations over the years\u2014particularly with Daniel Kahneman, Charlie Plott, and Richard Thaler, and numerous coauthors\u2014have shaped the contents of this paper. Discussions at the Russell Sage Foundation during my 1991-92 visit there were especially formative. \n\nPublished as Camerer, Colin. \"Rules for experimenting in psychology and economics, and why they differ.\" In Understanding Strategic Interaction, pp. 313-327. Springer Berlin Heidelberg, 1997.\n\nSubmitted - sswp946.pdf
", "abstract": "This chapter discusses methodological differences in the way economists and psychologists typically conduct experiments. The main argument is that methodological differences spring from basic differences in the way knowledge is created and cumulated in the two fields - especially the important role of simple, formal theory in economics which is largely absent in psychology.", "date": "2017-08-21", "date_type": "published", "publisher": "California Institute of Technology", "id_number": "CaltechAUTHORS:20170817-144503614", "official_url": "https://resolver.caltech.edu/CaltechAUTHORS:20170817-144503614", "rights": "No commercial reproduction, distribution, display or performance rights in this work are provided.", "local_group": { "items": [ { "id": "Social-Science-Working-Papers" } ] }, "doi": "10.7907/hnsrp-4yw45", "primary_object": { "basename": "sswp946.pdf", "url": "https://authors.library.caltech.edu/records/hnsrp-4yw45/files/sswp946.pdf" }, "resource_type": "monograph", "pub_year": "2017", "author_list": "Camerer, Colin F." }, { "id": "https://authors.library.caltech.edu/records/1n74w-dk551", "eprint_id": 80585, "eprint_status": "archive", "datestamp": "2023-08-20 06:10:24", "lastmod": "2024-01-14 05:09:02", "type": "monograph", "metadata_visibility": "show", "creators": { "items": [ { "id": "Cachon-G-P", "name": { "family": "Cachon", "given": "G\u00e9rard P." } }, { "id": "Camerer-C-F", "name": { "family": "Camerer", "given": "Colin F." }, "orcid": "0000-0003-4049-1871" } ] }, "title": "Loss Avoidance and Forward Induction in Experimental Coordination Games", "ispublished": "unpub", "full_text_status": "public", "keywords": "Fees, Statistical median, Games, Private costs, Cost of entry, Coordination games, Economic costs, Inductive reasoning, Coordination failures, Auctions", "note": "Abstract obtained from published version of this article. \n\nPublished as Cachon, Gerard P., and Colin F. Camerer. \"Loss-avoidance and forward induction in experimental coordination games.\" The Quarterly Journal of Economics 111.1 (1996): 165-194.\n\nSubmitted - sswp937.pdf
", "abstract": "We report experiments on how players select among multiple Pareto-ranked equilibria in a coordination game. Subjects initially choose inefficient equilibria. Charging a fee to play (which makes initial equilibria money-losing) creates coordination on better equilibria. When fees are optional, improved coordination is consistent with forward induction. But coordination improves even when subjects must pay the fee (forward induction does not apply). Subjects appear to use a \"loss-avoidance\" selection principle: they expect others to avoid strategies that always result in losses. Loss-avoidance implies that \"mental accounting\" of out- comes can affect choices in games.", "date": "2017-08-18", "date_type": "published", "publisher": "California Institute of Technology", "id_number": "CaltechAUTHORS:20170817-160321150", "official_url": "https://resolver.caltech.edu/CaltechAUTHORS:20170817-160321150", "rights": "No commercial reproduction, distribution, display or performance rights in this work are provided.", "local_group": { "items": [ { "id": "Social-Science-Working-Papers" } ] }, "doi": "10.7907/1n74w-dk551", "primary_object": { "basename": "sswp937.pdf", "url": "https://authors.library.caltech.edu/records/1n74w-dk551/files/sswp937.pdf" }, "resource_type": "monograph", "pub_year": "2017", "author_list": "Cachon, G\u00e9rard P. and Camerer, Colin F." }, { "id": "https://authors.library.caltech.edu/records/t6hjv-nrt82", "eprint_id": 80628, "eprint_status": "archive", "datestamp": "2023-08-20 05:40:54", "lastmod": "2024-01-14 05:09:34", "type": "monograph", "metadata_visibility": "show", "creators": { "items": [ { "id": "Knez-M-J", "name": { "family": "Knez", "given": "Marc" } }, { "id": "Camerer-C-F", "name": { "family": "Camerer", "given": "Colin F." }, "orcid": "0000-0003-4049-1871" } ] }, "title": "Outside Options and Social Comparison in 3-Player Ultimatum Game Experiments", "ispublished": "unpub", "full_text_status": "public", "note": "We thank participants in the Social Organization of Competition Workshop (U Chicago) and the Behavioral Decision Research in Management conference (Boston, May 1994), and the referees and special issue editor Tom Palfrey, for extremely helpful comments.\n\nPublished as Knez, Marc J., and Colin F. Camerer. \"Outside options and social comparison in three-player ultimatum game experiments.\" Games and Economic Behavior 10, no. 1 (1995): 65-94.\n\nSubmitted - sswp920.pdf
", "abstract": "We conducted ultimatum games in which a proposer offers a division of $10 to a respondent, who accepts or rejects it. If an offer is rejected, players receive a known outside option. Our proposers made simultaneous offers to two respondents, with outside options of $2 and $4. The rate of rejected offers was higher than in similar studies, around 50%, and persisted across five trials. Outside options seem to make players \"egocentrically\" apply different interpretations of the amount being divided, which creates persistent disagreement. And half of respondents demand more when they know other respondents are being offered more.", "date": "2017-08-18", "date_type": "published", "publisher": "California Institute of Technology", "id_number": "CaltechAUTHORS:20170818-144943716", "official_url": "https://resolver.caltech.edu/CaltechAUTHORS:20170818-144943716", "rights": "No commercial reproduction, distribution, display or performance rights in this work are provided.", "local_group": { "items": [ { "id": "Social-Science-Working-Papers" } ] }, "doi": "10.7907/t6hjv-nrt82", "primary_object": { "basename": "sswp920.pdf", "url": "https://authors.library.caltech.edu/records/t6hjv-nrt82/files/sswp920.pdf" }, "resource_type": "monograph", "pub_year": "2017", "author_list": "Knez, Marc and Camerer, Colin F." }, { "id": "https://authors.library.caltech.edu/records/g0knw-0jx59", "eprint_id": 80503, "eprint_status": "archive", "datestamp": "2023-08-20 07:33:53", "lastmod": "2024-01-14 05:08:03", "type": "monograph", "metadata_visibility": "show", "creators": { "items": [ { "id": "Blecherman-B", "name": { "family": "Blecherman", "given": "Barry" } }, { "id": "Camerer-C-F", "name": { "family": "Camerer", "given": "Colin F." }, "orcid": "0000-0003-4049-1871" } ] }, "title": "Is There a Winner's Curse In The Market For Baseball Players? Evidence From The Field", "ispublished": "unpub", "full_text_status": "public", "note": "Comments by the first author's dissertation committee members, Joe Harder, Paul Kleindorfer, Howard Kunreuther, and Keith Weigelt, were very helpful. Funds were provided by the Risk and Decision Processes Center of the Wharton School and by NSF grant SES88-09299.\n\nSubmitted - sswp966.pdf
", "abstract": "A winner's curse exists in common value auctions when bidders fail to fully account for the fact that the winning bidder's valuation of the object is an upward-biased estimates of its true (unknown) value. Previous studies have reported mixed evidence for a winner's curse in oil lease auctions, corporate takeovers, auctions for failed banks, and in many experiments. In this paper we search for a winner's curse in the 1990 negotiations for free agent baseball players. Free agents are overpaid, relative to direct estimates of the revenue impact of their performance, by about 50% on average. A control sample of non-free agent players, in contrast, are overpaid by only 1 %. However, proper adjustment for the winner's curse requires bidders to bid less when the variance of an object's value is lower; and salaries are lower for players with more variable previous performances. Taken together, the data show a large winner's curse but the curse is not due to teams mistakenly paying more for high-variance players.", "date": "2017-08-17", "date_type": "published", "publisher": "California Institute of Technology", "id_number": "CaltechAUTHORS:20170816-143334824", "official_url": "https://resolver.caltech.edu/CaltechAUTHORS:20170816-143334824", "rights": "No commercial reproduction, distribution, display or performance rights in this work are provided.", "funders": { "items": [ { "agency": "NSF", "grant_number": "SES88-09299" }, { "agency": "Wharton School, University of Pennsylvania" } ] }, "local_group": { "items": [ { "id": "Social-Science-Working-Papers" } ] }, "doi": "10.7907/g0knw-0jx59", "primary_object": { "basename": "sswp966.pdf", "url": "https://authors.library.caltech.edu/records/g0knw-0jx59/files/sswp966.pdf" }, "resource_type": "monograph", "pub_year": "2017", "author_list": "Blecherman, Barry and Camerer, Colin F." }, { "id": "https://authors.library.caltech.edu/records/9dtj1-nks95", "eprint_id": 80520, "eprint_status": "archive", "datestamp": "2023-08-20 07:27:08", "lastmod": "2024-01-14 05:08:15", "type": "monograph", "metadata_visibility": "show", "creators": { "items": [ { "id": "Camerer-C-F", "name": { "family": "Camerer", "given": "Colin F." }, "orcid": "0000-0003-4049-1871" }, { "id": "Babcock-L", "name": { "family": "Babcock", "given": "Linda" } }, { "id": "Loewenstein-G", "name": { "family": "Loewenstein", "given": "George" } }, { "id": "Thaler-R-H", "name": { "family": "Thaler", "given": "Richard H." } } ] }, "title": "Labor Supply of New York City Cab Drivers: One Day at a Time", "ispublished": "unpub", "full_text_status": "public", "note": "Please do not circulate or quote without permission. Many thanks to Bruce Schaller (NYC Taxi and Limousine Commission) for data and helpful discussions, James Choi and Dov Rosenberg for research assistance, Keith Weigelt for survey data, John Ham and Charles Brown for helpful discussions, and colleagues at the NBER-Russell Sage Foundation Behavioral Labor Economics meeting, Carnegie Mellon University's Heinz School of Public Policy and Management, the University of California (Irvine and Berkeley) Departments of Economics, the MIT/Harvard Behavioral Economics seminar, the University of Chicago Labor Workshop, the Judgment/Decision Making Society, and the Econometric Society meetings, for helpful comments.\n\nPublished as Camerer, Colin, Linda Babcock, George Loewenstein, and Richard Thaler. \"Labor supply of New York City cabdrivers: One day at a time.\" The Quarterly Journal of Economics 112, no. 2 (1997): 407-441.\n\nSubmitted - sswp960.pdf
", "abstract": "Life-cycle models of labor supply predict a positive relationship between hours supplied and transitory changes in wages because such changes have virtually no effect on life-cycle wealth. Previous attempts to test this hypothesis empirically with time-series data have not been supportive; estimated elasticities are typically negative or nonsignificant. Such analyses, however, are vulnerable to measurement error and other estimation problems. We use data on daily observations of wages and hours for New York City cab drivers to estimate the supply response to transitory fluctuations in wages. Cab drivers decide daily how many hours to supply, and face wages that are positively correlated within days, but largely uncorrelated between days. Using these data, our central finding is that wage elasticities are persistently negative\u2013from -.5 to -1 in three different samples\u2013even after correcting for measurement error using instrumental variables. These negative wage elasticities challenge the notion that cab drivers trade off labor and leisure at different points in time and question the empirical adequacy of life-cycle formulations of labor supply.", "date": "2017-08-17", "date_type": "published", "publisher": "California Institute of Technology", "id_number": "CaltechAUTHORS:20170816-154840294", "official_url": "https://resolver.caltech.edu/CaltechAUTHORS:20170816-154840294", "rights": "No commercial reproduction, distribution, display or performance rights in this work are provided.", "local_group": { "items": [ { "id": "Social-Science-Working-Papers" } ] }, "doi": "10.7907/9dtj1-nks95", "primary_object": { "basename": "sswp960.pdf", "url": "https://authors.library.caltech.edu/records/9dtj1-nks95/files/sswp960.pdf" }, "resource_type": "monograph", "pub_year": "2017", "author_list": "Camerer, Colin F.; Babcock, Linda; et el." }, { "id": "https://authors.library.caltech.edu/records/gfg3r-ew664", "eprint_id": 80492, "eprint_status": "archive", "datestamp": "2023-08-20 07:33:39", "lastmod": "2024-01-14 05:07:55", "type": "monograph", "metadata_visibility": "show", "creators": { "items": [ { "id": "Camerer-C-F", "name": { "family": "Camerer", "given": "Colin F." }, "orcid": "0000-0003-4049-1871" }, { "id": "Knez-M-J", "name": { "family": "Knez", "given": "Marc J." } }, { "id": "Weber-R-A", "name": { "family": "Weber", "given": "Roberto A." } } ] }, "title": "Timing and Virtual Observability in Ultimatum Bargaining and Weak Link Coordination Games", "ispublished": "unpub", "full_text_status": "public", "keywords": "timing, coordination games, experiments", "note": "We thank Gary Bolton, Yuval Rottenstreich, participants in the Chicago GSB Behavioral Science brown bag lunch workshop, the Wharton Decision Processes workshop, and the 1996 Public Choice Society meeting for ideas, and NSF grant SBR-9511001 for financial support. \n\nPublished as Weber, Roberto A., Colin F. Camerer, and Marc Knez. \"Timing and virtual observability in ultimatum bargaining and \"weak link\" coordination games.\" Experimental Economics 7, no. 1 (2004): 25-48.\n\nSubmitted - sswp970.pdf
", "abstract": "Previous studies have shown that simply knowing some players move first can affect behavior in games, even when the first-movers' moves are unobservable. This observation violates the game-theoretic principle that timing of unobserved moves is irrelevant. We extend this work by varying timing of unobservable moves in ultimatum bargaining games and \"weak link\" coordination games. Timing without observability affects both bargaining and coordination, but only weakly. The results are consistent with theories that allow \"virtual observability\" of first-mover choices, rather than theories in which timing matters only because first-mover advantage is used as a principle of equilibrium selection.", "date": "2017-08-17", "date_type": "published", "publisher": "California Institute of Technology", "id_number": "CaltechAUTHORS:20170816-134044325", "official_url": "https://resolver.caltech.edu/CaltechAUTHORS:20170816-134044325", "rights": "No commercial reproduction, distribution, display or performance rights in this work are provided.", "funders": { "items": [ { "agency": "NSF", "grant_number": "SBR-9511001" } ] }, "local_group": { "items": [ { "id": "Social-Science-Working-Papers" } ] }, "doi": "10.7907/gfg3r-ew664", "primary_object": { "basename": "sswp970.pdf", "url": "https://authors.library.caltech.edu/records/gfg3r-ew664/files/sswp970.pdf" }, "resource_type": "monograph", "pub_year": "2017", "author_list": "Camerer, Colin F.; Knez, Marc J.; et el." }, { "id": "https://authors.library.caltech.edu/records/6z163-c7z10", "eprint_id": 80440, "eprint_status": "archive", "datestamp": "2023-08-22 11:12:52", "lastmod": "2024-01-14 05:07:26", "type": "monograph", "metadata_visibility": "show", "creators": { "items": [ { "id": "Camerer-C-F", "name": { "family": "Camerer", "given": "Colin F." }, "orcid": "0000-0003-4049-1871" } ] }, "title": "Can Asset Markets be Manipulated? A Field Experiment with Racetrack Betting", "ispublished": "unpub", "full_text_status": "public", "keywords": "Experimental Economics; Information aggregation; Field experiment; Market manipulation", "note": "Wonderful research assistance was provided by Jessica San-San Tien, Dov and Amanda Rosenberg, and Hongjai Rhee. Excellent secretarial work was done by Gail Nash. Helpful comments were received from the MacArthur Foundation Preferences Group, the Russell Sage Foundation Behavioral Economics Summer Camp (Berkeley, 9/96), and discussions with Teck Ho, Hongjai Rhee, Charles Plott and Simon Wilkie. Preparation for this research was provided by Rich Palmer and Burt Camerer (who taught me to ask \"why is that?\"). \n\nPublished as Camerer, Colin F. (1998) Can Asset Markets Be Manipulated? A Field Experiment With Racetrack Betting. Journal of Political Economy, 106 (3). pp. 457-482.\n\nSubmitted - sswp983.pdf
", "abstract": "To test whether naturally-occurring markets can be strategically manipulated, $500 bets were made at a large racetrack, then cancelled. The net effects of these costless bets gives clues about whether market participants react to information potentially contained in large bets. While the bets moved odds on \"attack\" horses visibly (compared to matched-pair control horses with similar pre-bet odds), the net effect on betting was close to zero. A second study with $1000 bets at a smaller track replicated the result. These markets could not be successfully manipulated, indicating that bettors did not mistakenly infer information from the experimental bets.", "date": "2017-08-16", "date_type": "published", "publisher": "California Institute of Technology", "id_number": "CaltechAUTHORS:20170815-154108288", "official_url": "https://resolver.caltech.edu/CaltechAUTHORS:20170815-154108288", "rights": "No commercial reproduction, distribution, display or performance rights in this work are provided.", "local_group": { "items": [ { "id": "Social-Science-Working-Papers" } ] }, "doi": "10.7907/6z163-c7z10", "primary_object": { "basename": "sswp983.pdf", "url": "https://authors.library.caltech.edu/records/6z163-c7z10/files/sswp983.pdf" }, "resource_type": "monograph", "pub_year": "2017", "author_list": "Camerer, Colin F." }, { "id": "https://authors.library.caltech.edu/records/2wqmd-n6102", "eprint_id": 80456, "eprint_status": "archive", "datestamp": "2023-08-19 00:04:20", "lastmod": "2024-01-14 05:07:44", "type": "monograph", "metadata_visibility": "show", "creators": { "items": [ { "id": "Ho-Teck-Hua", "name": { "family": "Ho", "given": "Teck H." }, "orcid": "0000-0001-5210-4977" }, { "id": "Weigelt-Keith", "name": { "family": "Weigelt", "given": "Keith" } }, { "id": "Camerer-C-F", "name": { "family": "Camerer", "given": "Colin F." }, "orcid": "0000-0003-4049-1871" } ] }, "title": "Iterated Dominance and Iterated Best-Response in Experimental P-Beauty Contests", "ispublished": "unpub", "full_text_status": "public", "note": "Teck Ho and Qolin Camerer were sponsored in part by National Science Foundation Grant SBR-9511137 and Keith Weigelt by Wharton's Reginald Jones Center for Policy, Strategy, and Organization. We thank two anonymous referees, Rosemarie Nagel, Lisa Rutstrom, Dale Stahl, seminar participants at the University of Pennsylvania, UCLA, and the MacArthur Foundation Preferences Group, for helpful comments, and Hongjai Rhee for tireless research assistance. \n\nPublished as Ho, T.H., Camerer, C., & Weigelt, K. (1998). Iterated dominance and iterated best response in experimental\" p-beauty contests\". The American Economic Review, 88(4), 947-969.\n\nSubmitted - sswp974.pdf
", "abstract": "We study a dominance-solvable 'p-beauty contest' game in which a group of players simultaneously choose numbers from a closed interval. The winner is the player whose number is the closest top times the average, where p =/ 1. The numbers players choose can be taken as an indication of the number of steps of iterated reasoning about others they do. Choices in the first period show that the median number of steps of iterated reasoning is either one or two. Repeating the game produces reliable convergence to the unique Nash equilibrium. Choices in later periods are consistent with subjects' best-responding to previous choices, or iterating one step and best-responding to best responses. (Choices are not as consistent with 'learning direction theory' which embodies elements of belief-free reinforcement models). Variation in the values of p, the number of players, and whether subjects played a similar game before, all affect choices and learning.", "date": "2017-08-16", "date_type": "published", "publisher": "California Institute of Technology", "id_number": "CaltechAUTHORS:20170815-170549846", "official_url": "https://resolver.caltech.edu/CaltechAUTHORS:20170815-170549846", "rights": "No commercial reproduction, distribution, display or performance rights in this work are provided.", "funders": { "items": [ { "agency": "NSF", "grant_number": "SBR-9511137" }, { "agency": "Wharton School, University of Pennsylvania" } ] }, "local_group": { "items": [ { "id": "Social-Science-Working-Papers" } ] }, "doi": "10.7907/2wqmd-n6102", "primary_object": { "basename": "sswp974.pdf", "url": "https://authors.library.caltech.edu/records/2wqmd-n6102/files/sswp974.pdf" }, "resource_type": "monograph", "pub_year": "2017", "author_list": "Ho, Teck H.; Weigelt, Keith; et el." }, { "id": "https://authors.library.caltech.edu/records/teefk-9jr62", "eprint_id": 80455, "eprint_status": "archive", "datestamp": "2023-08-19 02:41:23", "lastmod": "2024-01-14 05:07:42", "type": "monograph", "metadata_visibility": "show", "creators": { "items": [ { "id": "Camerer-C-F", "name": { "family": "Camerer", "given": "Colin F." }, "orcid": "0000-0003-4049-1871" }, { "id": "Lovallo-D", "name": { "family": "Lovallo", "given": "Dan" } } ] }, "title": "Overconfidence and Excess Entry: An Experimental Approach", "ispublished": "unpub", "full_text_status": "public", "note": "Revised version. Original dated to July 1996. \n\nHelp and comments were received from Daniel Kahneman, Marc Knez, Matthew Rabin, David Teece, Dick Thaler, participants at the MacArthur Foundation Preferences Group, the 1995 J/DM Society, workshops at the Universities of Chicago and Colorado, UCLA, Harvard Business School, and Wharton, and several anonymous referees. Gail Nash provided superb secretarial help and Roberto Weber provided research assistance. The research was funded by NSF SBR-9511001. \n\nPublished as Camerer, C., & Lovallo, D. (1999). Overconfidence and excess entry: An experimental approach. The American Economic Review, 89(1), 306-318.\n\nSubmitted - sswp975_-_revised.pdf
", "abstract": "Psychological studies show that most people are overconfident about their own relative abilities, and unreasonably optimistic about their futures (e.g. Shelly E. Taylor and J.D. Brown, 1988; Neil D. Weinstein, 1980). When assessing their position in a distribution of peers on almost any positive trait-- like driving ability (Ola Svenson, 1981 ), income prospects, or longevity-- a vast majority of people say they are above the average, although of course, only half can be (if the trait is symmetrically distributed).\nThis paper explores whether optimistic biases could plausibly and predictably influence economic behavior in one particular setting-- entry into competitive games or markets. Many empirical studies show that most new businesses fail within a few years. For example, using plant level data from the U.S. Census of Manufacturers spanning 1963-1982, Timothy Dunne et al. (1988) estimated that 61.5 percent of all entrants exited within five years and 79.6 percent exited within 10 years. Most of these exits are failures (see also Dunne et al., 1989a, 1989b; D. Shapiro and R.S. Khemani, 1987).", "date": "2017-08-16", "date_type": "published", "publisher": "California Institute of Technology", "id_number": "CaltechAUTHORS:20170815-170009974", "official_url": "https://resolver.caltech.edu/CaltechAUTHORS:20170815-170009974", "rights": "No commercial reproduction, distribution, display or performance rights in this work are provided.", "funders": { "items": [ { "agency": "NSF", "grant_number": "SBR-9511001" } ] }, "local_group": { "items": [ { "id": "Social-Science-Working-Papers" } ] }, "doi": "10.7907/teefk-9jr62", "primary_object": { "basename": "sswp975_-_revised.pdf", "url": "https://authors.library.caltech.edu/records/teefk-9jr62/files/sswp975_-_revised.pdf" }, "resource_type": "monograph", "pub_year": "2017", "author_list": "Camerer, Colin F. and Lovallo, Dan" }, { "id": "https://authors.library.caltech.edu/records/4e2kf-nme71", "eprint_id": 80389, "eprint_status": "archive", "datestamp": "2023-08-19 02:05:13", "lastmod": "2024-01-14 00:53:42", "type": "monograph", "metadata_visibility": "show", "creators": { "items": [ { "id": "Camerer-C-F", "name": { "family": "Camerer", "given": "Colin F." }, "orcid": "0000-0003-4049-1871" }, { "id": "Ho-Teck-Hua", "name": { "family": "Ho", "given": "Teck-Hua" }, "orcid": "0000-0001-5210-4977" } ] }, "title": "Experience-weighted Attraction Learning in Normal Form Games", "ispublished": "unpub", "full_text_status": "public", "keywords": "Learning, behavioral game theory, reinforcement learning, fictitious play", "note": "Revised version. Original dated to March 1997. \n\nThis research was supported by NSF grants SBR-9511001, 9511137, and 9601236, and the hospitality of the Center for Advanced Study in Behavioral Sciences. We have had helpful discussions with Chris Anderson, Bruno Broseta, Vince Crawford, Ido Erev, Drew Fudenberg, Dave Grether, Elef Gkioulekas, Yuval Rottenstreich, Rakesh Sarin, John Van Huyck, and Robert Weber, and research assistance from Hongjai Rhee, Chris Anderson, and Juin Kuan Chong. Barry Sopher generously provided data for us to analyze. Many helpful comments were received from anonymous referees and seminar participants at the Society for Mathematical Psychology conference (July 1996), the Russell Sage Foundation Summer Institute in Behavioral Economics (July 1996) the Economic Science Association meetings (October 1996), the Marketing Science Conference (March 1997), Bonn Conference on Theories of Bounded Rationality (May 1997), the FUR VIII Conference in Mons, Belgium (July 1997), Gerzensee ESSET Economic Theory Conference (July 1997), and seminars at Caltech, Harvard and Washington Universities, and the Universities of Alicante, Autonoma, California (Berkeley, Los Angeles), Chicago, Pennsylvania, Pittsburgh, Pompeu Fabra, Texas (Austin) and Texas A&M. \n\nPublished as Camerer, C., & Hua Ho, T. (1999). Experience\u2010weighted attraction learning in normal form games. Econometrica, 67(4), 827-874.\n\nSubmitted - sswp1003.pdf
", "abstract": "We describe a general model, 'experience-weighted attraction' (EWA) learning, which includes reinforcement learning and a class of weighted fictitious play belief models as special cases. In EWA, strategies have attractions which reflect prior predispositions, are updated based on payoff experience, and determine choice probabilities according to some rule (e.g., logit). A key feature is a parameter \u03b4 which weights the strength of hypothetical reinforcement of strategies which were not chosen according to the payoff they would have yielded. When \u03b4 = 0 choice reinforcement results. When \u03b4 = 1, levels of reinforcement of strategies are proportional to expected payoffs given beliefs based on past history. Another key feature is the growth rates of attractions. The EWA model controls the growth rates by two decay parameters, \u03c6 and \u03c1, which depreciate attractions and amount of experience separately. When \u03c6 = \u03c1, belief-based models result; when \u03c1 = 0 choice reinforcement results.\nUsing three data sets, parameter estimates of the model were calibrated on part of the data and used to predict the rest. Estimates of \u03b4 are generally around .50, \u03c6 around 1, and \u03c1 varies from 0 to \u03c6. Choice reinforcement models often outperform belief-based models in the calibration phase and underperform in out-of-sample validation. Both special cases are generally rejected in favor of EWA, though sometimes belief models do better. EWA is able to combine the best features of both approaches, allowing attractions to begin and grow flexibly as choice reinforcement does, but reinforcing unchosen strategies substantially as belief-based models implicitly do.", "date": "2017-08-15", "date_type": "published", "publisher": "California Institute of Technology", "id_number": "CaltechAUTHORS:20170814-161157311", "official_url": "https://resolver.caltech.edu/CaltechAUTHORS:20170814-161157311", "rights": "No commercial reproduction, distribution, display or performance rights in this work are provided.", "funders": { "items": [ { "agency": "NSF", "grant_number": "SBR-9511001" }, { "agency": "NSF", "grant_number": "SBR-9511137" }, { "agency": "NSF", "grant_number": "SBR-9601236" } ] }, "collection": "CaltechAUTHORS", "local_group": { "items": [ { "id": "Social-Science-Working-Papers", "value": "Social Science Working Papers" } ] }, "doi": "10.7907/4e2kf-nme71", "primary_object": { "basename": "sswp1003.pdf", "url": "https://authors.library.caltech.edu/records/4e2kf-nme71/files/sswp1003.pdf" }, "resource_type": "monograph", "pub_year": "2017", "author_list": "Camerer, Colin F. and Ho, Teck-Hua" }, { "id": "https://authors.library.caltech.edu/records/1kpw8-3yp19", "eprint_id": 80427, "eprint_status": "archive", "datestamp": "2023-08-19 00:38:17", "lastmod": "2024-01-14 00:54:01", "type": "monograph", "metadata_visibility": "show", "creators": { "items": [ { "id": "Weber-R-A", "name": { "family": "Weber", "given": "Roberto A." } }, { "id": "Rottenstreich-Y", "name": { "family": "Rottenstreich", "given": "Yuval" } }, { "id": "Camerer-C-F", "name": { "family": "Camerer", "given": "Colin F." }, "orcid": "0000-0003-4049-1871" }, { "id": "Knez-M-J", "name": { "family": "Knez", "given": "Marc J." } } ] }, "title": "The Illusion of Leadership", "ispublished": "unpub", "full_text_status": "public", "keywords": "Fees, Game theory, Blame, Group size, Coordination games, Attribution theory, Social psychology, Questionnaires, Leadership qualities, Coordinate systems", "note": "This preliminary version was prepared for circulation at the Judgment/Decision Making Society meetings, Chicago, November 1996. Please do not quote or circulate, but comments are welcome. This research was funded by NSF grant SBR-9511001 to Camerer. We thank participants at a University of Arizona Department of Management Seminar for helpful discussion.\n\nPublished as Weber, R., Camerer, C., Rottenstreich, Y., & Knez, M. (2001). The illusion of leadership: Misattribution of cause in coordination games. Organization Science, 12(5), 582-598.\n\nSubmitted - sswp993_-_revised.pdf
", "abstract": "This paper reports experiments which examine attributions of leadership quality due to differences in situations. Subjects played an abstract coordination game which is analogous to some organizational situations. Previous research showed that when large groups play the game, they rarely coordinate on the Pareto-optimal (efficient) outcome, but small groups almost always coordinate on a Pareto-optimal outcome. After two or three periods of playing the game, one subject who was randomly selected from among the participants to be the \"leader\" for the experiment was instructed to make a speech exhorting others to choose the efficient action. Based on previous studies with small and large groups, we predicted that small groups would succeed in achieving efficiency and large groups would fail. Based on research on the fundamental attribution error in social psychology, we predicted that the leaders would be credited for the success of the small groups, and blamed for the failure of the large groups. The effects of the leaders in improving coordination were, as predicted, overshadowed by the situational variable (group size). Nonetheless, there was an \"illusion of leadership\": subjects attributed differences in outcomes between conditions to differences in the effectiveness of leaders. In a second experiment, subjects in both large and small groups coordinated efficiently, but gave less credit to the second leader than the first.", "date": "2017-08-15", "date_type": "published", "publisher": "California Institute of Technology", "id_number": "CaltechAUTHORS:20170815-142759861", "official_url": "https://resolver.caltech.edu/CaltechAUTHORS:20170815-142759861", "rights": "No commercial reproduction, distribution, display or performance rights in this work are provided.", "funders": { "items": [ { "agency": "NSF", "grant_number": "SBR-9511001" } ] }, "local_group": { "items": [ { "id": "Social-Science-Working-Papers" } ] }, "doi": "10.7907/1kpw8-3yp19", "primary_object": { "basename": "sswp993_-_revised.pdf", "url": "https://authors.library.caltech.edu/records/1kpw8-3yp19/files/sswp993_-_revised.pdf" }, "resource_type": "monograph", "pub_year": "2017", "author_list": "Weber, Roberto A.; Rottenstreich, Yuval; et el." }, { "id": "https://authors.library.caltech.edu/records/n0gd5-at008", "eprint_id": 80326, "eprint_status": "archive", "datestamp": "2023-08-19 02:34:10", "lastmod": "2024-01-14 00:53:00", "type": "monograph", "metadata_visibility": "show", "creators": { "items": [ { "id": "Camerer-C-F", "name": { "family": "Camerer", "given": "Colin F." }, "orcid": "0000-0003-4049-1871" } ] }, "title": "Bounded Rationality in Individual Decision Making", "ispublished": "unpub", "full_text_status": "public", "note": "This paper is based on a lecture at the Bonn Conference on Theories of Bounded Rationality, May 1997. Helpful comments were received from Charles Holt, and Angela Hung assisted with research. It was written in the warm incubator of the Center for Advanced Study for Behavioral Sciences, with support from National Science Foundation grant SBR-9601236.\n\nPublished as Camerer, C. (1998). Bounded rationality in individual decision making. Experimental economics, 1(2), 163-183.\n\nSubmitted - sswp1029.pdf
", "abstract": "My goals in this paper are: (i) To give a pithy, opinionated summary of what has been learned about bounded rationality in individual decision making from experiments in economics and psychology (drawing on my 1995 Handbook of Experimental Economics chapter); and (ii) mention some promising new directions for research which would be included if that chapter were written today.", "date": "2017-08-11", "date_type": "published", "publisher": "California Institute of Technology", "id_number": "CaltechAUTHORS:20170811-161943874", "official_url": "https://resolver.caltech.edu/CaltechAUTHORS:20170811-161943874", "rights": "No commercial reproduction, distribution, display or performance rights in this work are provided.", "funders": { "items": [ { "agency": "NSF", "grant_number": "SBR-9601236" } ] }, "local_group": { "items": [ { "id": "Social-Science-Working-Papers" } ] }, "doi": "10.7907/n0gd5-at008", "primary_object": { "basename": "sswp1029.pdf", "url": "https://authors.library.caltech.edu/records/n0gd5-at008/files/sswp1029.pdf" }, "resource_type": "monograph", "pub_year": "2017", "author_list": "Camerer, Colin F." }, { "id": "https://authors.library.caltech.edu/records/q4x6c-tg374", "eprint_id": 80310, "eprint_status": "archive", "datestamp": "2023-08-19 02:58:17", "lastmod": "2024-01-14 00:52:41", "type": "monograph", "metadata_visibility": "show", "creators": { "items": [ { "id": "Johnson-E-J", "name": { "family": "Johnson", "given": "Eric J." } }, { "id": "Camerer-C-F", "name": { "family": "Camerer", "given": "Colin F." }, "orcid": "0000-0003-4049-1871" }, { "id": "Sen-Sankar", "name": { "family": "Sen", "given": "Sankar" } }, { "id": "Rymon-T", "name": { "family": "Rymon", "given": "Talia" } } ] }, "title": "Detecting Failures of Backward Induction: Monitoring Information Search in Sequential Bargaining", "ispublished": "unpub", "full_text_status": "public", "keywords": "bargaining, experimental economics, bounded rationality, behavioral economics, behavioral game theory, fairness, limited cognition", "note": "The financial support of NSF 88-09299 and NSF 90-23531 to the first two authors is gratefully acknowledged. We also thank Rachel Croson, Brian Becker, Barry Blecherman, Gerard Cachon, David Goldstein, Teck-Hua Ho, Keith Weigelt, Ben Wilner, and many colleagues at Penn for their work and ideas. We also have received helpful comments from several referees and seminar participants at many universities including Harvard, Cornell, New York University, Penn State, Rochester, Toronto, Minnesota, MIT, and the International Conference on Game Theory (Florence) and BoWo IV (Bonn). \n\nPublished as Johnson, E.J., Camerer, C., Sen, S., & Rymon, T. (2002). Detecting failures of backward induction: Monitoring information search in sequential bargaining. Journal of Economic Theory, 104(1), 16-47.\n\nSubmitted - sswp1040.pdf
", "abstract": "We ran three-round sequential bargaining experiments in which the perfect equilibrium offer was $1.25 and an equal split was $2.50. Subjects offered $2.11 to other subjects, $1.84 to \"robot\" players (who are known to play subgame perfectly), and $1.22 to robots after instruction in backward induction. Measures of information search showed that subjects did not look at the amounts being divided in different rounds in the correct order, and for the length of time, necessary for backward induction, unless they were specifically instructed. The results suggest that most of the departure from perfect equilibrium is due to limited computation and some is due to fairness.", "date": "2017-08-11", "date_type": "published", "publisher": "California Institute of Technology", "id_number": "CaltechAUTHORS:20170811-144320736", "official_url": "https://resolver.caltech.edu/CaltechAUTHORS:20170811-144320736", "rights": "No commercial reproduction, distribution, display or performance rights in this work are provided.", "funders": { "items": [ { "agency": "NSF", "grant_number": "SES-8809299" }, { "agency": "NSF", "grant_number": "SES-9023531" } ] }, "local_group": { "items": [ { "id": "Social-Science-Working-Papers" } ] }, "doi": "10.7907/q4x6c-tg374", "primary_object": { "basename": "sswp1040.pdf", "url": "https://authors.library.caltech.edu/records/q4x6c-tg374/files/sswp1040.pdf" }, "resource_type": "monograph", "pub_year": "2017", "author_list": "Johnson, Eric J.; Camerer, Colin F.; et el." }, { "id": "https://authors.library.caltech.edu/records/p3ren-j9d62", "eprint_id": 80314, "eprint_status": "archive", "datestamp": "2023-08-19 02:49:43", "lastmod": "2024-01-14 00:52:44", "type": "monograph", "metadata_visibility": "show", "creators": { "items": [ { "id": "Camerer-C-F", "name": { "family": "Camerer", "given": "Colin F." }, "orcid": "0000-0003-4049-1871" } ] }, "title": "Prospect theory in the wild: Evidence from the field", "ispublished": "unpub", "full_text_status": "public", "note": "This paper was prepared for D. Kahneman and A. Tversky (Eds.), Choices, Values and Frames (in press). The research was supported by NSF grant SBR-9601236 and the hospitality of the Center for Advanced Study in Behavioral Sciences during 1997-98. Linda Babcock and Barbara Mellers gave helpful suggestions. \n\nPublished as Camerer, Colin F. (2001) Prospect Theory In The Wild: Evidence From The Field. In: Choices, Values, and Frames. Contemporary Psychology. No.47. American Psychological Association , Washington, DC, pp. 288-300.\n\nSubmitted - sswp1037.pdf
", "abstract": "The workhorses of economic analysis are simple formal models that can explain naturally occurring phenomena. Reflecting this taste, economists often say they will incorporate more psychological ideas into economics if those ideas can parsimoniously account for field data better than standard theories do. Taking this statement seriously, this article describes 10 regularities in naturally occurring data that are anomalies for expected utility theory but can all be explained by three simple elements of prospect theory: loss aversion, reflection effects, and nonlinear weighting of probability; moreover, the assumption is made that people isolate decisions (or edit them) from others they might be grouped with (Read, Loewenstein, and Rabin 1999; cf. Thaler, 1999). I hope to show how much success has already been had applying prospect theory to field data and to inspire economists and psychologists to spend more time in the wild.", "date": "2017-08-11", "date_type": "published", "publisher": "California Institute of Technology", "id_number": "CaltechAUTHORS:20170811-150835361", "official_url": "https://resolver.caltech.edu/CaltechAUTHORS:20170811-150835361", "rights": "No commercial reproduction, distribution, display or performance rights in this work are provided.", "funders": { "items": [ { "agency": "NSF", "grant_number": "SBR-9601236" } ] }, "local_group": { "items": [ { "id": "Social-Science-Working-Papers" } ] }, "doi": "10.7907/p3ren-j9d62", "primary_object": { "basename": "sswp1037.pdf", "url": "https://authors.library.caltech.edu/records/p3ren-j9d62/files/sswp1037.pdf" }, "resource_type": "monograph", "pub_year": "2017", "author_list": "Camerer, Colin F." }, { "id": "https://authors.library.caltech.edu/records/t4j0a-rh635", "eprint_id": 80306, "eprint_status": "archive", "datestamp": "2023-08-22 13:02:41", "lastmod": "2024-01-14 00:52:35", "type": "monograph", "metadata_visibility": "show", "creators": { "items": [ { "id": "Camerer-C-F", "name": { "family": "Camerer", "given": "Colin F." }, "orcid": "0000-0003-4049-1871" }, { "id": "Weber-R-A", "name": { "family": "Weber", "given": "Roberto A." } } ] }, "title": "The econometrics and behavioral economics of escalation of commitment: A re-examination of Staw & Hoang's NBA data", "ispublished": "unpub", "full_text_status": "public", "keywords": "Escalation; Sunk cost fallacy; Behavioral economics", "note": "We thank Amanda Rosenberg and Gail Nash for data entry, and participants at the Psychology-Economics Conference, Vancouver BC (June 6-7 1997), Linda Babcock, Max Bazerman, Richard Day, David Grether, Chip Heath, Keith Murnighan, Tom Ross, Barry Staw, Keith Weigelt and an anonymous referee for helpful comments.\n\nPublished as Camerer, C.F., & Weber, R.A. (1999). The econometrics and behavioral economics of escalation of commitment: A re-examination of Staw and Hoang's NBA data. Journal of Economic Behavior & Organization, 39(1), 59-82.\n\nSubmitted - sswp1043.pdf
", "abstract": "We examine the phenomenon of escalation from an economist's perspective, emphasizing explanations which do not rule out rational behavior on the part of firms or agents. We argue that escalation cannot be established as a separate phenomenon unless these possible alternative explanations are properly accounted for. We present Staw and Hoang's (1995) study of NBA data as an instance of where evidence of escalation might be overturned upon more careful analysis. After performing several tests of our alternative explanations, we find that evidence of escalation persists, although it is weaker both in duration and magnitude.", "date": "2017-08-11", "date_type": "published", "publisher": "California Institute of Technology", "id_number": "CaltechAUTHORS:20170811-142521643", "official_url": "https://resolver.caltech.edu/CaltechAUTHORS:20170811-142521643", "rights": "No commercial reproduction, distribution, display or performance rights in this work are provided.", "local_group": { "items": [ { "id": "Social-Science-Working-Papers" } ] }, "doi": "10.7907/t4j0a-rh635", "primary_object": { "basename": "sswp1043.pdf", "url": "https://authors.library.caltech.edu/records/t4j0a-rh635/files/sswp1043.pdf" }, "resource_type": "monograph", "pub_year": "2017", "author_list": "Camerer, Colin F. and Weber, Roberto A." }, { "id": "https://authors.library.caltech.edu/records/t3pzy-0et43", "eprint_id": 80262, "eprint_status": "archive", "datestamp": "2023-08-19 04:07:05", "lastmod": "2024-01-13 23:32:30", "type": "monograph", "metadata_visibility": "show", "creators": { "items": [ { "id": "Camerer-C-F", "name": { "family": "Camerer", "given": "Colin F." }, "orcid": "0000-0003-4049-1871" }, { "id": "Anderson-C-M", "name": { "family": "Anderson", "given": "Christopher M." } } ] }, "title": "Experience-Weighted Attraction Learning in Sender-Receiver Signaling Games", "ispublished": "unpub", "full_text_status": "public", "keywords": "Learning, Game theory experiments, Signaling games, Equilibrium refinement", "note": "This research was supported by NSF SBR-9511001. Thanks to Jordi Brandts and Charlie Holt for supplying their raw data. Helpful comments were received from audiences at the Universities of California (Berkeley), Texas (Austin) and the Fall 1998 ESA Meetings. \n\nPublished as Anderson, C.M., & Camerer, C.F. (2000). Experience-weighted attraction learning in sender-receiver signaling games. Economic Theory, 16(3), 689-718.\n\nSubmitted - sswp1058.pdf
", "abstract": "Recent experiments have indicated that it is possible to systematically lead subjects to less refined equilibria in signaling games. In this paper, we seek to understand the process by which this occurs using Camerer and Ho's Experience Weighted Attraction (EWA) model of learning in games. We first adapt the model to extensive-form signaling games by specifying that senders update the chosen message for both the realized and unrealized type, but do not update the unchosen message. We test this model against the choice reinforcement and belief-based special cases of EWA; the latter is of particular interest because it formalizes the story about convergence to less refined equilibria offered by Brandts and Holt. We also test a variety of models which update unchosen messages. We find that while the Brandts-Holt story captures the direction of switching from one strategy to another, it does not do a good job at capturing the rate at which the switching occurs. EWA does quite well at predicting the rate of switching, and is slightly bettered by the unchosen message models, which all perform equally well.", "date": "2017-08-10", "date_type": "published", "publisher": "California Institute of Technology", "id_number": "CaltechAUTHORS:20170810-160858318", "official_url": "https://resolver.caltech.edu/CaltechAUTHORS:20170810-160858318", "rights": "No commercial reproduction, distribution, display or performance rights in this work are provided.", "funders": { "items": [ { "agency": "NSF", "grant_number": "SBR-9511001" } ] }, "local_group": { "items": [ { "id": "Social-Science-Working-Papers" } ] }, "doi": "10.7907/t3pzy-0et43", "primary_object": { "basename": "sswp1058.pdf", "url": "https://authors.library.caltech.edu/records/t3pzy-0et43/files/sswp1058.pdf" }, "resource_type": "monograph", "pub_year": "2017", "author_list": "Camerer, Colin F. and Anderson, Christopher M." }, { "id": "https://authors.library.caltech.edu/records/96ycp-0c965", "eprint_id": 79722, "eprint_status": "archive", "datestamp": "2023-08-19 06:10:37", "lastmod": "2024-01-13 23:28:18", "type": "monograph", "metadata_visibility": "show", "creators": { "items": [ { "id": "Camerer-C-F", "name": { "family": "Camerer", "given": "Colin F." }, "orcid": "0000-0003-4049-1871" }, { "id": "Hsia-David", "name": { "family": "Hsia", "given": "David" } }, { "id": "Ho-Teck-Hua", "name": { "family": "Ho", "given": "Teck-Hua" }, "orcid": "0000-0001-5210-4977" } ] }, "title": "EWA Learning in Bilateral Call Markets", "ispublished": "unpub", "full_text_status": "public", "keywords": "Experimental economics, call markets, sealed-bid mechanism, learning", "note": "Thanks to Terry Daniel for supplying data. This research has been supported by NSF grant SBR-9730364 and a MacArthur Foundation Preferences Network postdoctoral fellowship to David Hsia.\n\nPublished as Camerer, Colin F. and Hsia, David and Ho, Teck-Hua (2002) EWA learning in bilateral call markets. In: Experimental Business Research. Kluwer Academic Publishers, Boston, MA, pp. 255-284.\n\nSubmitted - sswp1098.pdf
", "abstract": "This chapter extends the EWA learning model to bilateral call market games (also known as the \"sealed-bid mechanism\" in two-person bargaining). In these games, a buyer and seller independently draw private values from commonly-known distributions and submit bids. If the buyer's bid is above the seller's, they trade at the midpoint of the two bids; otherwise they don't trade. We apply EWA by assuming that players have value-dependent bidding strategies, and they partially generalize experience from one value/cost condition to another in response to the incentives from nonlinear optimal bid functions. The same learning model can be applied to other market institutions where subjects economize on learning by taking into consideration similarity between past experience and a new environment while still recognizing the difference in market incentives between them. The chapter also presents a new application of EWA to a \"continental divide\" coordination game, and reviews 32 earlier studies comparing EWA, reinforcement, and belief learning. The application shows the advantages of a generalized adaptive model of behavior that includes elements of reinforcement, belief-based and direction learning as special cases at some cost of complexity for the benefit of generality and psychological appeal. It is a good foundation to build upon to extend our understanding of adaptive behavior in more general games and market institutions. In future work, we should investigate the similarity parameters, \u03c8 and \u03c9, to better characterize their magnitude and significance in different market institutions.", "date": "2017-08-09", "date_type": "published", "publisher": "California Institute of Technology", "id_number": "CaltechAUTHORS:20170801-162754834", "official_url": "https://resolver.caltech.edu/CaltechAUTHORS:20170801-162754834", "rights": "No commercial reproduction, distribution, display or performance rights in this work are provided.", "funders": { "items": [ { "agency": "NSF", "grant_number": "SBR-9730364" }, { "agency": "John D. and Catherine T. MacArthur Foundation" } ] }, "local_group": { "items": [ { "id": "Social-Science-Working-Papers" } ] }, "doi": "10.7907/96ycp-0c965", "primary_object": { "basename": "sswp1098.pdf", "url": "https://authors.library.caltech.edu/records/96ycp-0c965/files/sswp1098.pdf" }, "resource_type": "monograph", "pub_year": "2017", "author_list": "Camerer, Colin F.; Hsia, David; et el." }, { "id": "https://authors.library.caltech.edu/records/acy85-62128", "eprint_id": 79965, "eprint_status": "archive", "datestamp": "2023-08-19 07:57:15", "lastmod": "2024-01-13 23:31:05", "type": "monograph", "metadata_visibility": "show", "creators": { "items": [ { "id": "Camerer-C-F", "name": { "family": "Camerer", "given": "Colin F." }, "orcid": "0000-0003-4049-1871" }, { "id": "Ho-Teck-Hua", "name": { "family": "Ho", "given": "Teck-Hua" }, "orcid": "0000-0001-5210-4977" }, { "id": "Chong-Juin-Kuan", "name": { "family": "Chong", "given": "Juin-Kuan" }, "orcid": "0000-0002-5187-8652" } ] }, "title": "Sophisticated EWA Learning and Strategic Teaching in Repeated Games", "ispublished": "unpub", "full_text_status": "public", "note": "Revised version. Original dated to April 2000. \n\nThis research was supported by NSF grants SBR-9730364 and SBR-9730187. Many thanks to Vince Crawford, Drew Fudenberg, David Hsia, John Kagel, and Xin Wang for discussions and help. Helpful comments were also received from seminar participants at Berkeley, Caltech, Harvard, Hong Kong UST, and Wharton. \n\nPublished as Colin F. Camerer, Teck-Hua Ho, Juin-Kuan Chong, Sophisticated Experience-Weighted Attraction Learning and Strategic Teaching in Repeated Games, Journal of Economic Theory, Volume 104, Issue 1, 2002, Pages 137-188,\n\nSubmitted - sswp1087.pdf
", "abstract": "Most learning models assume players are adaptive (i.e., they respond only to their own previous experience and ignore others' payoff information) and behavior is not sensitive to the way in which players are matched. Empirical evidence suggests otherwise. In this paper, we extend our adaptive experience-weighted attraction (EWA) learning model to capture sophisticated learning and strategic teaching in repeated games.\n\nThe generalized model assumes there is a mixture of adaptive learners and sophisticated players. An adaptive learner adjusts his behavior the EWA way. A sophisticated player rationally best-responds to her forecasts of all other behaviors. A sophisticated player can be either myopic or farsighted. A farsighted player develops multiple-period rather than single-period forecasts of others' behaviors and chooses to \"teach\" the other players by choosing a strategy scenario that gives her the highest discounted net present value.\n\nWe estimate the model using data from p-beauty contests and repeated trust games with incomplete information. The generalized model is better than the adaptive EWA model in describing and predicting behavior. Including teaching also allows an empirical learning-based approach to reputation formation which predicts better than a quantal-response extension of the standard type-based approach.", "date": "2017-08-09", "date_type": "published", "publisher": "California Institute of Technology", "id_number": "CaltechAUTHORS:20170808-151402454", "official_url": "https://resolver.caltech.edu/CaltechAUTHORS:20170808-151402454", "rights": "No commercial reproduction, distribution, display or performance rights in this work are provided.", "funders": { "items": [ { "agency": "NSF", "grant_number": "SBR-9730364" }, { "agency": "NSF", "grant_number": "SBR-9730187" } ] }, "local_group": { "items": [ { "id": "Social-Science-Working-Papers" } ] }, "doi": "10.7907/acy85-62128", "primary_object": { "basename": "sswp1087.pdf", "url": "https://authors.library.caltech.edu/records/acy85-62128/files/sswp1087.pdf" }, "resource_type": "monograph", "pub_year": "2017", "author_list": "Camerer, Colin F.; Ho, Teck-Hua; et el." }, { "id": "https://authors.library.caltech.edu/records/byfnc-zek61", "eprint_id": 79891, "eprint_status": "archive", "datestamp": "2023-08-19 06:09:21", "lastmod": "2024-01-13 23:30:25", "type": "monograph", "metadata_visibility": "show", "creators": { "items": [ { "id": "Camerer-C-F", "name": { "family": "Camerer", "given": "Colin F." }, "orcid": "0000-0003-4049-1871" }, { "id": "Ho-Teck-Hua", "name": { "family": "Ho", "given": "Teck H." }, "orcid": "0000-0001-5210-4977" } ] }, "title": "Strategic Learning and Teaching", "ispublished": "unpub", "full_text_status": "public", "note": "Published as Camerer, Colin F. and Ho, Teck H. (2001) Strategic Learning and Teaching. In: Wharton on Making Decisions. Wiley , New York, pp. 159-175.\n\nSubmitted - sswp1100.pdf
", "abstract": "Decision makers learn from experience and this learning affects their future decisions. But how? Using game theory, the authors explore how people factor in the payoffs of past decisions in their current choices. The authors introduce the concept of experience-weighted attraction (EWA) to explain how people learn from their experience. Sophisticated players can use this concept to learn which strategies work and \"outguess\" their rivals. And by understanding how rivals and customers learn, managers can take actions that \"teach\" rivals and customers what you want them to believe\u2014reassuring partners and intimidating competitors.", "date": "2017-08-08", "date_type": "published", "publisher": "California Institute of Technology", "id_number": "CaltechAUTHORS:20170807-171037465", "official_url": "https://resolver.caltech.edu/CaltechAUTHORS:20170807-171037465", "rights": "No commercial reproduction, distribution, display or performance rights in this work are provided.", "local_group": { "items": [ { "id": "Social-Science-Working-Papers" } ] }, "doi": "10.7907/byfnc-zek61", "primary_object": { "basename": "sswp1100.pdf", "url": "https://authors.library.caltech.edu/records/byfnc-zek61/files/sswp1100.pdf" }, "resource_type": "monograph", "pub_year": "2017", "author_list": "Camerer, Colin F. and Ho, Teck H." }, { "id": "https://authors.library.caltech.edu/records/ymtpq-vtd88", "eprint_id": 79428, "eprint_status": "archive", "datestamp": "2023-08-19 02:44:34", "lastmod": "2024-01-13 20:36:46", "type": "monograph", "metadata_visibility": "show", "creators": { "items": [ { "id": "Linardi-S", "name": { "family": "Linardi", "given": "Sera" } }, { "id": "Camerer-C-F", "name": { "family": "Camerer", "given": "Colin F." }, "orcid": "0000-0003-4049-1871" } ] }, "title": "Can Relational Contracts Survive Stochastic Interruptions?", "ispublished": "unpub", "full_text_status": "public", "keywords": "experiments, labor, contracting, organizational design", "note": "We would like to thank participants of 4th IZA Behavioral Labor Workshop (October 16-18, 2008, Bonn), ESA 2008, Jean-Laurent Rosenthal, Martin Brown and Christian Zehnder.\n\nSubmitted - sswp1340.pdf
", "abstract": "This paper investigates the robustness of the \"two-tiered labor market\" experimental results of Brown, Falk and Fehr (2004) by subjecting relationships to stochastic interruptions. Using two different subject pools, we first replicate the basic pattern of high quality private contracting and low quality public contracting. We then study the impact of exogenous random 'downturns' in which firms cannot hire workers for three periods. Our hypothesis is that 1. job rents are lower in downturns 2. this will lower wages and effort, unless strong re-connection norms exist. We do find that job rents are lower, but surprisingly, the downturns do not harm aggregate market efficiency. Stochastic interruptions delay the formation of relationships, necessitating the use of public offers, which increases the competitiveness of the short term market. The high tier (private) markets responds by raising wages, thus increasing average worker surplus per trade. We also find evidence that 50-50 pre-downturn worker-firm surplus sharing predicts post-downturn re-connections.", "date": "2017-08-07", "date_type": "published", "publisher": "California Institute of Technology", "id_number": "CaltechAUTHORS:20170726-134336781", "official_url": "https://resolver.caltech.edu/CaltechAUTHORS:20170726-134336781", "rights": "No commercial reproduction, distribution, display or performance rights in this work are provided.", "local_group": { "items": [ { "id": "Social-Science-Working-Papers" } ] }, "doi": "10.7907/ymtpq-vtd88", "primary_object": { "basename": "sswp1340.pdf", "url": "https://authors.library.caltech.edu/records/ymtpq-vtd88/files/sswp1340.pdf" }, "resource_type": "monograph", "pub_year": "2017", "author_list": "Linardi, Sera and Camerer, Colin F." }, { "id": "https://authors.library.caltech.edu/records/fksby-kk523", "eprint_id": 79855, "eprint_status": "archive", "datestamp": "2023-08-19 07:39:09", "lastmod": "2024-01-13 23:29:47", "type": "monograph", "metadata_visibility": "show", "creators": { "items": [ { "id": "Ho-Teck-Hua", "name": { "family": "Ho", "given": "Teck-Hua" }, "orcid": "0000-0001-5210-4977" }, { "id": "Camerer-C-F", "name": { "family": "Camerer", "given": "Colin F." }, "orcid": "0000-0003-4049-1871" }, { "id": "Chong-Juin-Kuan", "name": { "family": "Chong", "given": "Juin-Kuan" }, "orcid": "0000-0002-5187-8652" } ] }, "title": "Economic Value of EWA Lite: A Functional Theory of Learning in Games", "ispublished": "unpub", "full_text_status": "public", "note": "This paper should not be circulated or quoted without permission. Thanks to participants in the Southern Economics Association meetings (December, 2000), the Wharton School Decision Processes Workshop, and C. Monica Capra for comments.\n\nSubmitted - sswp1122.pdf
", "abstract": "EWA Lite is a one-parameter theory of learning in normal-form games. It approximates the free parameters in an earlier model (EWA) with functions of experience. The theory is tested on seven different games and compared to other learning and equilibrium theories. Either EWA Lite or parameterized EWA predict best, but one kind of reinforcement learning predicts well in games with mixed-strategy equilibrium. Belief learning models fit worst. The economic value of theories is measured by how much more subjects would have earned if they followed theory recommendations. EWA Lite and EWA add the most economic value in every game but one.", "date": "2017-08-07", "date_type": "published", "publisher": "California Institute of Technology", "id_number": "CaltechAUTHORS:20170807-135200613", "official_url": "https://resolver.caltech.edu/CaltechAUTHORS:20170807-135200613", "rights": "No commercial reproduction, distribution, display or performance rights in this work are provided.", "local_group": { "items": [ { "id": "Social-Science-Working-Papers" } ] }, "doi": "10.7907/fksby-kk523", "primary_object": { "basename": "sswp1122.pdf", "url": "https://authors.library.caltech.edu/records/fksby-kk523/files/sswp1122.pdf" }, "resource_type": "monograph", "pub_year": "2017", "author_list": "Ho, Teck-Hua; Camerer, Colin F.; et el." }, { "id": "https://authors.library.caltech.edu/records/1dxq5-hze86", "eprint_id": 79668, "eprint_status": "archive", "datestamp": "2023-08-19 17:49:50", "lastmod": "2024-01-13 23:27:33", "type": "monograph", "metadata_visibility": "show", "creators": { "items": [ { "id": "Camerer-C-F", "name": { "family": "Camerer", "given": "Colin F." }, "orcid": "0000-0003-4049-1871" }, { "id": "Palfrey-T-R", "name": { "family": "Palfrey", "given": "Thomas R." }, "orcid": "0000-0003-0769-8109" }, { "id": "Rogers-B-W", "name": { "family": "Rogers", "given": "Brian W." } } ] }, "title": "Heterogeneous Quantal Response Equilibrium and Cognitive Hierarchies", "ispublished": "unpub", "full_text_status": "public", "keywords": "experimental economics, quantal response equilibrium, cognitive hierarchy, behavioral game theory", "note": "We are grateful to the National Science Foundation grants SES-0079301 and SES-0450712 for supporting this research.\n\nSubmitted - sswp1260.pdf
", "abstract": "We explore an equilibrium model of games where players' choice behavior is given by logit response functions, but their payoff responsiveness is heterogeneous. We extend the definition of quantal response equilibrium to this setting, calling it heterogeneous quantal response equilibrium (HQRE), and prove existence under weak conditions. We generalize HQRE to allow for limited insight, in which players can only imagine others with low responsiveness. We identify a formal connection between this new equilibrium concept, called truncated quantal response equilibrium (TQRE), and the Cognitive Hierarchy (CH) model. We show that CH can be approximated arbitrarily closely by TQRE. We report a series of experiments comparing the performance of QRE, HQRE, TQRE and CH. A surprise is that the fi of the models are quite close across a variety of matrix and dominance-solvable asymmetric information betting games. The key link is that in the QRE approaches, strategies with higher expected payoffs are chosen more often than strategies with lower expected payoff. In CH this property is not built into the model, but generally holds true in the experimental data.", "date": "2017-08-01", "date_type": "published", "publisher": "California Institute of Technology", "id_number": "CaltechAUTHORS:20170801-093456313", "official_url": "https://resolver.caltech.edu/CaltechAUTHORS:20170801-093456313", "rights": "No commercial reproduction, distribution, display or performance rights in this work are provided.", "funders": { "items": [ { "agency": "NSF", "grant_number": "SES-0079301" }, { "agency": "NSF", "grant_number": "SES-0450712" } ] }, "local_group": { "items": [ { "id": "Social-Science-Working-Papers" } ] }, "doi": "10.7907/1dxq5-hze86", "primary_object": { "basename": "sswp1260.pdf", "url": "https://authors.library.caltech.edu/records/1dxq5-hze86/files/sswp1260.pdf" }, "resource_type": "monograph", "pub_year": "2017", "author_list": "Camerer, Colin F.; Palfrey, Thomas R.; et el." }, { "id": "https://authors.library.caltech.edu/records/pr9cf-1xg79", "eprint_id": 64919, "eprint_status": "archive", "datestamp": "2023-08-20 04:01:03", "lastmod": "2024-01-13 16:42:52", "type": "monograph", "metadata_visibility": "show", "creators": { "items": [ { "id": "Camerer-C-F", "name": { "family": "Camerer", "given": "Colin F." }, "orcid": "0000-0003-4049-1871" }, { "id": "Nunnari-S", "name": { "family": "Nunnari", "given": "Salvatore" } }, { "id": "Palfrey-T-R", "name": { "family": "Palfrey", "given": "Thomas R." }, "orcid": "0000-0003-0769-8109" } ] }, "title": "Quantal Response and Nonequilibrium Beliefs Explain Overbidding in Maximum-Value Auctions", "ispublished": "unpub", "full_text_status": "public", "note": "January 13, 2011. Added June 2011. Updated December 11, 2014.\n\nWe are grateful for comments from seminar audiences at the 2010 North-American ESA Meeting in\nTucson, the Security Market Auctions and IPOs Conference at Northwestern University, the University of Southern California, and Stanford University. We thank Asen Ivanov, Dan Levin, and Muriel Niederle for sharing their data and for detailed comments on an earlier draft. Palfrey thanks NSF and Russell Sage Foundation for financial support.\n\nAccepted Version - sswp1349.pdf
Updated - sswp_1349.pdf
", "abstract": "We report an experiment on a simple common value auction to investigate the extent to which bidding can be explained by quantal response equilibrium, in combination with different\nassumptions about the structure of bidder beliefs|the cursed equilibrium model and models that posit levels of strategic sophistication. Using a structural estimation approach, we find a close correspondence between the theoretical predictions of those models and experimental\nbehavior. The basic pattern of average bids in the data consists of a combination of overbidding for low signals, and value-bidding for higher signals. The logit QRE model with heterogeneous bidders fits this pattern reasonably well. Combining quantal response with either cursed beliefs (CE-QRE) or a level-k of strategic sophistication (LK-QRE, CH-QRE) leads to a close match with the data. All these variations on quantal response models predict minimal differences of average bidding behavior across different versions of the game, consistent with the experimental\nfindings. Finally, we reanalyze data from an earlier experiment on the same auction by Ivanov, Levin and Niederle (2010). While their data exhibit much more variance compared with ours, nonetheless, we still find that these models also fit their data reasonably well, even in the presence of extreme overbidding observed in that experiment. Overall, our study indicates that the winner curse phenomenon in this auction is plausibly attributable to limits on strategic thinking combined with quantal response.", "date": "2016-03-04", "date_type": "published", "publisher": "California Institute of Technology", "id_number": "CaltechAUTHORS:20160301-134857624", "official_url": "https://resolver.caltech.edu/CaltechAUTHORS:20160301-134857624", "rights": "No commercial reproduction, distribution, display or performance rights in this work are provided.", "funders": { "items": [ { "agency": "NSF" }, { "agency": "Russell Sage Foundation" } ] }, "local_group": { "items": [ { "id": "Social-Science-Working-Papers" } ] }, "doi": "10.7907/pr9cf-1xg79", "primary_object": { "basename": "sswp1349.pdf", "url": "https://authors.library.caltech.edu/records/pr9cf-1xg79/files/sswp1349.pdf" }, "related_objects": [ { "basename": "sswp_1349.pdf", "url": "https://authors.library.caltech.edu/records/pr9cf-1xg79/files/sswp_1349.pdf" } ], "resource_type": "monograph", "pub_year": "2016", "author_list": "Camerer, Colin F.; Nunnari, Salvatore; et el." }, { "id": "https://authors.library.caltech.edu/records/ge461-3d968", "eprint_id": 65003, "eprint_status": "archive", "datestamp": "2023-08-19 10:16:45", "lastmod": "2023-10-17 22:03:09", "type": "monograph", "metadata_visibility": "show", "creators": { "items": [ { "id": "Camerer-C-F", "name": { "family": "Camerer", "given": "Colin F." }, "orcid": "0000-0003-4049-1871" }, { "id": "Ho-Teck-Hua", "name": { "family": "Ho", "given": "Teck H." }, "orcid": "0000-0001-5210-4977" }, { "id": "Chong-Juin-Kuan", "name": { "family": "Chong", "given": "Juin-Kuan" }, "orcid": "0000-0002-5187-8652" } ] }, "title": "Functional EWA: A One-parameter Theory of Learning in Games", "ispublished": "unpub", "full_text_status": "public", "note": "Thanks to participants in the 2000 Southern Economics Association meetings, the Wharton School Decision Processes Workshop, the University of Pittsburgh, the Berkeley Marketing Workshop, the Nobel Symposium on Behavioral and Experimental\nEconomics (December 2001) and C. M\u00f3nica Capra, David Cooper, Vince Crawford, Ido Erev, Guillaume Frechette and two referees for comments.\n\nSubmitted - fewaRES.pdf
", "abstract": "Functional experience weighted attraction (fEWA) is a one-parameter theory of learning\nin games. It approximates the free parameters in an earlier model (EWA) with functions\nof experience. The theory was originally tested on seven different games and compared to\nfour other learning and equilibrium theories, then three more games were added. Generally\nfEWA or parameterized EWA predict best out-of-sample, but one kind of reinforcement\nlearning predicts well in games with mixed-strategy equilibrium. Of the learning models,\nbelief learning models fit worst but fit better than noisy (quantal response) equilibrium\nmodels. The economic value of a theory is measured by how much more subjects would\nhave earned if they followed the theory's recommendations. Most learning theories add\nvalue (though equilibrium theories often subtract value) and fEWA and EWA usually add\nthe most value.", "date": "2016-03-03", "date_type": "published", "publisher": "California Institute of Technology", "id_number": "CaltechAUTHORS:20160303-102558354", "official_url": "https://resolver.caltech.edu/CaltechAUTHORS:20160303-102558354", "rights": "No commercial reproduction, distribution, display or performance rights in this work are provided.", "primary_object": { "basename": "fewaRES.pdf", "url": "https://authors.library.caltech.edu/records/ge461-3d968/files/fewaRES.pdf" }, "resource_type": "monograph", "pub_year": "2016", "author_list": "Camerer, Colin F.; Ho, Teck H.; et el." }, { "id": "https://authors.library.caltech.edu/records/63gqk-man33", "eprint_id": 65002, "eprint_status": "archive", "datestamp": "2023-08-19 13:16:15", "lastmod": "2023-10-17 22:03:07", "type": "monograph", "metadata_visibility": "show", "creators": { "items": [ { "id": "Ho-Teck-Hua", "name": { "family": "Ho", "given": "Teck H." }, "orcid": "0000-0001-5210-4977" }, { "id": "Camerer-C-F", "name": { "family": "Camerer", "given": "Colin F." }, "orcid": "0000-0003-4049-1871" }, { "id": "Chong-Juin-Kuan", "name": { "family": "Chong", "given": "Juin-Kuan" }, "orcid": "0000-0002-5187-8652" } ] }, "title": "The Economics of Learning Models: A Self-tuning Theory of Learning in Games", "ispublished": "unpub", "full_text_status": "public", "note": "Thanks to participants in the 2000 Southern Economics Association meetings, the Wharton School Decision Processes Workshop, the University of Pittsburgh, the Berkeley Marketing Workshop, the Nobel Symposium on Behavioral and Experimental Economics (December 2001) and C. M\u00f3nica Capra, David Cooper, Vince Crawford, Ido Erev, and Guillaume Frechette for helpful comments.\n\nSubmitted - AER2004.pdf
", "abstract": "Self-tuning experience weighted attraction (EWA) is a one-parameter theory of learning\nin games. It replaces the key parameters in an earlier model (EWA) with functions of\nexperience that \"self-tune\" over time. The theory was tested on seven different games, and\ncompared to the earlier model and a one-parameter stochastic equilibrium theory. The more\nparsimonious self-tuning EWA does as well as EWA in predicting behavior in new games,\nand reliably better than an equilibrium benchmark. The economic value of a learning theory\nis measured by how much more subjects would have earned in an experimental session if\nthey followed the theory's recommendations. Economic values for several learning and\nequilibrium theories were estimated (controlled for boomerang effects of following a model's\nadvice in one period, on future earnings). Most models have economic value. Self-tuning\nEWA adds the most value.", "date": "2016-03-03", "date_type": "published", "publisher": "California Institute of Technology", "id_number": "CaltechAUTHORS:20160303-102321736", "official_url": "https://resolver.caltech.edu/CaltechAUTHORS:20160303-102321736", "rights": "No commercial reproduction, distribution, display or performance rights in this work are provided.", "primary_object": { "basename": "AER2004.pdf", "url": "https://authors.library.caltech.edu/records/63gqk-man33/files/AER2004.pdf" }, "resource_type": "monograph", "pub_year": "2016", "author_list": "Ho, Teck H.; Camerer, Colin F.; et el." }, { "id": "https://authors.library.caltech.edu/records/c02mr-kz141", "eprint_id": 44357, "eprint_status": "archive", "datestamp": "2023-08-19 04:14:30", "lastmod": "2024-01-13 15:24:55", "type": "monograph", "metadata_visibility": "show", "creators": { "items": [ { "id": "Plott-C-R", "name": { "family": "Plott", "given": "Charles R." } }, { "id": "Camerer-C-F", "name": { "family": "Camerer", "given": "Colin F." }, "orcid": "0000-0003-4049-1871" }, { "id": "Noeth-M", "name": { "family": "Noeth", "given": "Marcus" } }, { "id": "Webber-M", "name": { "family": "Webber", "given": "Martin" } } ] }, "title": "Information Aggregation in Experimental Asset Markets: Traps and Misaligned Beliefs", "ispublished": "unpub", "full_text_status": "public", "note": "The authors gratefully acknowledge the financial support for this research which was provided by the Caltech Laboratory\nfor Experimental Economics and Political Science and by the Gesellschaft der Freunde der Universitat Mannheim. Helpful\ncomments were received from Rob Bloomfield, Dan Friedman, Susanne Prantl, and seminar participants at the ESA meeting\n1996, EFA meeting 1997 and the Verein fur Socialpolitik meeting 1997.\n\nAccepted Version - wp1060.pdf
", "abstract": "The capacity of markets to aggregate information has been conclusively demonstrated but he limitations of that capacity have still not been fully explored. In this paper, we demonstrate the existence of \"information traps\". These traps appear to be a sort of equilibrium in which information existing in the market does not become revealed in prices. The foundation for the equilibrium is a pattern of misaligned beliefs in which each person's actions are based upon mistaken beliefs about the information held by others. The mistakes, themselves, have a type of mutual compatibility and cannot become revealed by the price discovery process because individuals have no incentives or resources to adjust. Attempts to probe the nature of the phenomena involved two period markets with a contingent claim instruments, experienced participants, and unlimited short selling opportunities.", "date": "2014-03-27", "date_type": "published", "publisher": "California Institute of Technology", "id_number": "CaltechAUTHORS:20140317-134842763", "official_url": "https://resolver.caltech.edu/CaltechAUTHORS:20140317-134842763", "rights": "No commercial reproduction, distribution, display or performance rights in this work are provided.", "funders": { "items": [ { "agency": "Caltech Laboratory for Experimental Economics and Political Science" }, { "agency": "Gesellschaft der Freunde der Universitat Mannheim" } ] }, "local_group": { "items": [ { "id": "Social-Science-Working-Papers" } ] }, "doi": "10.7907/c02mr-kz141", "primary_object": { "basename": "wp1060.pdf", "url": "https://authors.library.caltech.edu/records/c02mr-kz141/files/wp1060.pdf" }, "resource_type": "monograph", "pub_year": "2014", "author_list": "Plott, Charles R.; Camerer, Colin F.; et el." }, { "id": "https://authors.library.caltech.edu/records/fsv3c-kqw03", "eprint_id": 22722, "eprint_status": "archive", "datestamp": "2023-08-19 03:51:19", "lastmod": "2024-01-13 00:10:51", "type": "monograph", "metadata_visibility": "show", "creators": { "items": [ { "id": "Kang-Min-Jeong", "name": { "family": "Kang", "given": "Min Jeong" } }, { "id": "Ray-Debajyoti", "name": { "family": "Ray", "given": "Debajyoti" } }, { "id": "Camerer-C-F", "name": { "family": "Camerer", "given": "Colin F." }, "orcid": "0000-0003-4049-1871" } ] }, "title": "Anxiety and Learning in Dynamic and Static Clock Game Experiments", "ispublished": "unpub", "full_text_status": "public", "keywords": "Clock Games, Anxiety, Learning, Experimental Economics, Behavioural Game Theory, Price Bubbles", "note": "Preprint submitted to Elsevier.\n\nWe thank the Lipper Family Foundation Fellowship, HFSP\nand Moore Foundation for financial support, and John Morgan\nfor generous help supplying original data and software, and responding\nto questions.\n\nSubmitted - SSRN-id1679474_1_.pdf
", "abstract": "In clock games, agents receive differently-timed private signals when an asset value is above its fundamental. The price crashes to\nthe fundamental when K of N agents have decided to sell. If selling decisions are private, bubbles can be sustained because people\ndelay selling, after receiving signals, knowing that others will delay too. Our results replicate the main features of the one previous\nexperimental study of clock game (in two subject pools): Selling delays are shorter than predicted, but converge toward equilibrium\npredictions over repeated trials. We also find that delays are shorter in a dynamic game in which selling decisions unfold over time,\ncompared to a static equivalent in which subjects precommit to selling decisions. A model of learning with growing anxiety after\nsignal arrival can reproduce the empirical observations of shorter-than-predicted delay, smaller delay after later signal arrival, and\nshorter delays in dynamic games.", "date": "2012-02-21", "date_type": "published", "publisher": "California Institute of Technology", "id_number": "CaltechAUTHORS:20110308-152511187", "official_url": "https://resolver.caltech.edu/CaltechAUTHORS:20110308-152511187", "rights": "No commercial reproduction, distribution, display or performance rights in this work are provided.", "funders": { "items": [ { "agency": "Lipper Family Foundation" }, { "agency": "Human Frontier Science Program" }, { "agency": "Gordon and Betty Moore Foundation" } ] }, "primary_object": { "basename": "SSRN-id1679474_1_.pdf", "url": "https://authors.library.caltech.edu/records/fsv3c-kqw03/files/SSRN-id1679474_1_.pdf" }, "resource_type": "monograph", "pub_year": "2012", "author_list": "Kang, Min Jeong; Ray, Debajyoti; et el." }, { "id": "https://authors.library.caltech.edu/records/1qfpd-9ws43", "eprint_id": 22667, "eprint_status": "archive", "datestamp": "2023-08-19 17:51:53", "lastmod": "2024-01-13 00:10:43", "type": "monograph", "metadata_visibility": "show", "creators": { "items": [ { "id": "Rick-S", "name": { "family": "Rick", "given": "Scott" } }, { "id": "Weber-R-A", "name": { "family": "Weber", "given": "Roberto A." } }, { "id": "Camerer-C-F", "name": { "family": "Camerer", "given": "Colin F." }, "orcid": "0000-0003-4049-1871" } ] }, "title": "The Role of Tacit Routines in Coordinating Activity", "ispublished": "unpub", "full_text_status": "public", "keywords": "organizational coordination, experimental economics", "note": "This research was supported by NSF grant SES-0095570 to Camerer and Weber and an NSF Graduate Research\nFellowship to Rick. We thank participants at the 2003 ESA conference in Pittsburgh, the 2003 SITE conference in\nStanford, the 2003 NBER conference on organizational economics in Boston, the 2004 BDRM meetings in Durham,\nthe 2004 Strategy Research Forum in Toronto, and the 2004 ESA conference in Amsterdam, as well as seminar\nparticipants at Carnegie Mellon, UCLA, Caltech, and Duke for helpful comments and suggestions.\n\nSubmitted - ssrn-id911967_1_.pdf
", "abstract": "We explore the influence of tacit routines in obtaining coordination. Our experiment uses simple\nlaboratory \"firms,\" in which we interfere with one kind of firm's ability to develop tacit routines.\nThus, our firms vary in the degree to which they rely on this kind of knowledge \u2013 instead of\nother, explicit, mechanisms \u2013 for obtaining coordination. We find that interfering with the\ndevelopment of tacit routines harms firms' ability to coordinate. We then explore the extent to\nwhich firms are able to transfer their ability to coordinate activity, either to a new domain or to\nnew members. Our results indicate that tacit routines transfer more easily than other\nmechanisms to a new, but closely related, domain. However, routine-based firms perform\nslightly worse in their ability to incorporate new members.", "date": "2012-02-21", "date_type": "published", "publisher": "California Institute of Technology", "id_number": "CaltechAUTHORS:20110304-143717349", "official_url": "https://resolver.caltech.edu/CaltechAUTHORS:20110304-143717349", "rights": "No commercial reproduction, distribution, display or performance rights in this work are provided.", "funders": { "items": [ { "agency": "NSF", "grant_number": "SES-0095570" }, { "agency": "NSF Graduate Research Fellowship" } ] }, "primary_object": { "basename": "ssrn-id911967_1_.pdf", "url": "https://authors.library.caltech.edu/records/1qfpd-9ws43/files/ssrn-id911967_1_.pdf" }, "resource_type": "monograph", "pub_year": "2012", "author_list": "Rick, Scott; Weber, Roberto A.; et el." }, { "id": "https://authors.library.caltech.edu/records/g35d5-hyw12", "eprint_id": 22668, "eprint_status": "archive", "datestamp": "2023-08-20 00:52:53", "lastmod": "2024-01-13 00:10:45", "type": "monograph", "metadata_visibility": "show", "creators": { "items": [ { "id": "Brown-A-L", "name": { "family": "Brown", "given": "Alexander L." }, "orcid": "0000-0002-5582-5304" }, { "id": "Camerer-C-F", "name": { "family": "Camerer", "given": "Colin F." }, "orcid": "0000-0003-4049-1871" }, { "id": "Lovallo-D", "name": { "family": "Lovallo", "given": "Dan" } } ] }, "title": "To Review or Not to Review? Limited Strategic Thinking at the Movie Box Office", "ispublished": "unpub", "full_text_status": "public", "keywords": "behavioral game theory, limited strategic thinking, voluntary disclosure, experimental economics", "note": "Thanks to audiences at Caltech, especially David Grether, Stuart McDonald, Tom Palfrey, Charles\nPlott, Robert Sherman, and Leeat Yariv. Thanks also to audiences at Chicago GSB, Berkeley, Yale Graduate\nStudent Conference on Behavioral Science, 2007 North American ESA, SJDM and SEA. Thanks to\nDan Knoepfle for proofreading, Sera Linardi for a suggestion that lead to an 8-fold improvement in CH\nruntimes, Esther Hwang, Carmina Clarke, Ferdinand Dubin, and especially Jonathan Garrity for help with\ndata collection. Direct correspondence to Alexander L. Brown at abrown@econmail.tamu.edu.\n\nSubmitted - ssrn-id1281006_1_.pdf
", "abstract": "Film distributors occasionally withhold movies from critics before their release. Cold openings\nprovide a natural field setting to test models of limited strategic thinking. In a set of 856 widely\nreleased movies, cold opening produces a significant 15% increase in domestic box office revenue\n(though not in foreign markets and DVD sales), consistent with the hypothesis that some moviegoers\ndo not infer low quality from cold opening. Structural parameter estimates indicate 1\u20132 steps of\nstrategic thinking by moviegoers (comparable to experimental estimates). However, movie studios\nappear to think moviegoers are sophisticated since only 7% of movies are opened cold.", "date": "2012-02-21", "date_type": "published", "publisher": "California Institute of Technology", "id_number": "CaltechAUTHORS:20110304-145259116", "official_url": "https://resolver.caltech.edu/CaltechAUTHORS:20110304-145259116", "rights": "No commercial reproduction, distribution, display or performance rights in this work are provided.", "primary_object": { "basename": "ssrn-id1281006_1_.pdf", "url": "https://authors.library.caltech.edu/records/g35d5-hyw12/files/ssrn-id1281006_1_.pdf" }, "resource_type": "monograph", "pub_year": "2012", "author_list": "Brown, Alexander L.; Camerer, Colin F.; et el." }, { "id": "https://authors.library.caltech.edu/records/gwxxx-vd822", "eprint_id": 22469, "eprint_status": "archive", "datestamp": "2023-08-19 17:09:02", "lastmod": "2023-10-23 16:03:49", "type": "monograph", "metadata_visibility": "show", "creators": { "items": [ { "id": "Tanaka-Tomomi", "name": { "family": "Tanaka", "given": "Tomomi" } }, { "id": "Camerer-C-F", "name": { "family": "Camerer", "given": "Colin F." }, "orcid": "0000-0003-4049-1871" }, { "id": "Nguyen-Quang", "name": { "family": "Nguyen", "given": "Quang" } } ] }, "title": "Poverty, politics, and preferences: Field experiments and survey data from Vietnam", "ispublished": "unpub", "full_text_status": "public", "note": "Submitted - Vietnam_1_.pdf
Supplemental Material - Appendix_1_.pdf
", "abstract": "We conducted field experiments to investigate how wealth, political history, occupation, and other\ndemographic variables (from a comprehensive earlier household survey) are correlated with risk,\ntime discounting and trust in Vietnam. Our experiments suggest risk and time preferences depend\non the stage of economic development. In wealthier villages, people are less loss-averse and more\npatient. Our research also shows people who participate in ROSCAs (rotating credit associations)\nare more patient than non-participant, but those who participate in bidding ROSCAs are less patient\nand more risk averse than those who participate in fixed ROSCAs. Results from a trust game\ndemonstrate both positive and negative effects of communism. Villagers in the South tend to invest\nmore in low-income partners without expecting repayment. On the other hand, people in the north\nare more trustworthy but do not pass on more money to the poor. Our findings also suggest market\nactivities, like starting a small trade business, are correlated with trust and trustworthiness. We also\ncontribute to experimental methodology by using choices that separate different aspects of risk\naversion and time preferences in behavioral economics specifications.", "date": "2011-11-10", "date_type": "published", "publisher": "California Institute of Technology", "id_number": "CaltechAUTHORS:20110224-094646474", "official_url": "https://resolver.caltech.edu/CaltechAUTHORS:20110224-094646474", "rights": "No commercial reproduction, distribution, display or performance rights in this work are provided.", "primary_object": { "basename": "Appendix_1_.pdf", "url": "https://authors.library.caltech.edu/records/gwxxx-vd822/files/Appendix_1_.pdf" }, "related_objects": [ { "basename": "Vietnam_1_.pdf", "url": "https://authors.library.caltech.edu/records/gwxxx-vd822/files/Vietnam_1_.pdf" } ], "resource_type": "monograph", "pub_year": "2011", "author_list": "Tanaka, Tomomi; Camerer, Colin F.; et el." }, { "id": "https://authors.library.caltech.edu/records/nd42x-8ax73", "eprint_id": 22505, "eprint_status": "archive", "datestamp": "2023-08-19 19:52:29", "lastmod": "2023-10-23 16:04:53", "type": "monograph", "metadata_visibility": "show", "creators": { "items": [ { "id": "Brown-A-L", "name": { "family": "Brown", "given": "Alexander L." }, "orcid": "0000-0002-5582-5304" }, { "id": "Camerer-C-F", "name": { "family": "Camerer", "given": "Colin F." }, "orcid": "0000-0003-4049-1871" }, { "id": "Chua-Zhikang-Eric", "name": { "family": "Chua", "given": "Zhikang Eric" } } ] }, "title": "Learning and Visceral Temptation in Dynamic Savings Experiments", "ispublished": "unpub", "full_text_status": "public", "note": "This research was supported by NSF grant SES-0078911. We thank Chris Carroll, Daniel Houser,\nPaul Kattman, George Loewenstein, Tanga McDaniel, John Hey, Nat Wilcox, three anonymous referees and an\neditor for helpful comments. We also thank Julie Malmquist of the SSEL Caltech lab, Chong Juin Kuan (NUS),\nHackjin Kim, Tony Bruguier, and especially Min Jeong Kang (who ran several of the beverage-condition subjects\nherself) for help in doing the experiments.\n\nPublished - savingsR2_1_.pdf
", "abstract": "In models of optimal savings with income uncertainty and habit formation, people\nshould save early to create a buffer stock, to cushion bad income draws and limit\nthe negative internality from habit formation. In experiments in this setting,\npeople save too little initially, but learn to save optimally within four repeated\nlifecycles, or 1-2 lifecycles with \"social learning.\" Using beverage rewards (cola)\nto create visceral temptation, thirsty subjects who consume immediately\noverspend compared to subjects who only drink after time delay. The relative\noverspending of immediate-consumption subjects is consistent with hyperbolic\ndiscounting and dual-self models. Estimates of the present-bias choices are\n\u03b2=0.6-0.7, which are consistent with other studies (albeit over different time\nhorizons).", "date": "2011-02-25", "date_type": "published", "publisher": "Caltech Library", "id_number": "CaltechAUTHORS:20110225-081750755", "official_url": "https://resolver.caltech.edu/CaltechAUTHORS:20110225-081750755", "rights": "No commercial reproduction, distribution, display or performance rights in this work are provided.", "funders": { "items": [ { "agency": "NSF", "grant_number": "SES-0078911" } ] }, "primary_object": { "basename": "savingsR2_1_.pdf", "url": "https://authors.library.caltech.edu/records/nd42x-8ax73/files/savingsR2_1_.pdf" }, "resource_type": "monograph", "pub_year": "2011", "author_list": "Brown, Alexander L.; Camerer, Colin F.; et el." }, { "id": "https://authors.library.caltech.edu/records/q47a5-jvd90", "eprint_id": 22010, "eprint_status": "archive", "datestamp": "2023-08-19 05:29:57", "lastmod": "2023-10-23 15:36:21", "type": "monograph", "metadata_visibility": "show", "creators": { "items": [ { "id": "Chua-Zhikang-Eric", "name": { "family": "Chua", "given": "Zhikang" } }, { "id": "Camerer-C-F", "name": { "family": "Camerer", "given": "Colin F." }, "orcid": "0000-0003-4049-1871" } ] }, "title": "Experiments on Intertemporal Consumption with Habit Formation and Social Learning", "ispublished": "unpub", "full_text_status": "public", "note": "This research was supported by NSF grant SES-0078911. Thanks to Paul Kattuman and Tanga McDaniel, who read many drafts of this report. Julie Malmquist of the SSEL Caltech lab and Chong Juin Kuan (NUS) were helpful in running experiments.\n\nPublished - savingsjpe7.doc
", "abstract": "The standard approach to modeling intertemporal consumption is to assume that consumers are solving a dynamic optimization problem. Under realistic descriptions of utility and uncertainty\u2014stochastic income and habit formation-- these intertemporal problems are very difficult to solve. Optimizing agents must build up precautionary savings to buffer bad income realizations, and must anticipate the negative \"internality\" of current consumption on future utility, through habits. Yet recent empirical evidence has shown that consumption behavior of the average household in society conforms fairly well to the prescriptions of the optimal solution. This paper establishes potential ways in which consumers can attain near-optimal consumption behavior despite their mathematical and computational limitations in solving the complicated optimization problem. Individual and social learning mechanisms are proposed to be one possible link. Using an experimental approach, results show that by incorporating social learning and individual learning into the intertemporal consumption framework, participants' actual spending behavior converged effectively towards optimal consumption. While consumers persistently spend too much in early periods, they learn rapidly from their own experience (and \"socially learn\" from experience of others) to consume amounts close to optimal levels. Their spending is much more closely linked to optimal consumption (conditional on earlier spending) than to rule-of-thumb spending of current income or cash-on-hand. Despite their approximate optimality, consumers exhibit dramatic \"loss-aversion\" by strongly avoiding consumption levels which create negative levels of period-by-period utility (even when optimal utility is negative). The relative ratio of actual utilities to optimal utilities, for positive utility compared to negative, is 2.63. This coefficient is remarkably close to the coefficient of loss-aversion documented in a wide variety of risky and riskless choice domains, which shows that even when consumption is nearly-optimal, behavioral influences sharply affect decisions.", "date": "2011-02-04", "date_type": "published", "publisher": "Caltech Library", "id_number": "CaltechAUTHORS:20110204-095930523", "official_url": "https://resolver.caltech.edu/CaltechAUTHORS:20110204-095930523", "rights": "No commercial reproduction, distribution, display or performance rights in this work are provided.", "funders": { "items": [ { "agency": "NSF", "grant_number": "SES-0078911" } ] }, "primary_object": { "basename": "savingsjpe7.doc", "url": "https://authors.library.caltech.edu/records/q47a5-jvd90/files/savingsjpe7.doc" }, "resource_type": "monograph", "pub_year": "2011", "author_list": "Chua, Zhikang and Camerer, Colin F." }, { "id": "https://authors.library.caltech.edu/records/0gwev-06x98", "eprint_id": 22181, "eprint_status": "archive", "datestamp": "2023-08-19 04:44:24", "lastmod": "2024-01-13 00:09:44", "type": "monograph", "metadata_visibility": "show", "creators": { "items": [ { "id": "\u00d6stling-R", "name": { "family": "\u00d6stling", "given": "Robert" } }, { "id": "Wang-Joseph-Tao-yi", "name": { "family": "Wang", "given": "Joseph Tao-yi" }, "orcid": "0000-0001-6786-8099" }, { "id": "Chou-Eileen-Y", "name": { "family": "Chou", "given": "Eileen Y." } }, { "id": "Camerer-C-F", "name": { "family": "Camerer", "given": "Colin F." }, "orcid": "0000-0003-4049-1871" } ] }, "title": "Testing Game Theory in the Field: Swedish LUPI Lottery Games", "ispublished": "unpub", "full_text_status": "public", "keywords": "Population uncertainty, Poisson game, guessing game, experimental methods, behavioral game theory, level-k, cognitive hierarchy", "note": "This version: December 15, 2010.\nAugust 14, 2007, Revised December 15, 2010.\nThe first two authors, Joseph Tao-yi Wang and Robert \u00d6stling, contributed equally to this paper. A\nprevious version of this paper was included in Robert \u00d6stling's doctoral thesis. We are grateful for helpful\ncomments from Vincent Crawford, Tore Ellingsen, Ido Erev, Magnus Johannesson, Botond K\u00f6szegi,\nDavid Laibson, Erik Lindqvist, Stefan Molin, Noah Myung, Rosemarie Nagel, Charles Noussair, Carsten\nSchmidt, Dylan Thurston, Dmitri Vinogradov, Mark Voorneveld, J\u00f6rgen Weibull, seminar participants,\nco-editor Robert Porter and several anonymous referees. R\u00d6 acknowledges financial support from the\nJan Wallander and Tom Hedelius Foundation. JW acknowledges support from the NSC of Taiwan (NSC\n98-2410-H-002-069-MY2, NSC 99-2410-H-002-060-MY3). CFC acknowledges support from the NSF HSD\nprogram, HSFP, and the Betty and Gordon Moore Foundation.\n\nThis paper is published as:\n \u00d6stling, Robert, Joseph Tao-yi Wang, Eileen Chou and Colin F. Camerer, (2011), 'Testing Game Theory in the Field: Swedish LUPI Lottery Games', American Economic Journal: Microeconomics, Vol. 3, August, No. 3, pages 1-33\n\nSupplemental Material - hastef0671.appendix.pdf
Updated - hastef0671_1_.pdf
", "abstract": "Game theory is usually difficult to test precisely in the field because predictions typically\ndepend sensitively on features that are not controlled or observed. We conduct one such\ntest using field data from the Swedish lowest unique positive integer (LUPI) game. In the\nLUPI game, players pick positive integers and whoever chose the lowest unique number\nwins a fixed prize. Theoretical equilibrium predictions are derived assuming Poisson-\ndistributed uncertainty about the number of players, and tested using both field and\nlaboratory data. The field and lab data show similar patterns. Despite various deviations\nfrom equilibrium, there is a surprising degree of convergence toward equilibrium. Some\nof the deviations from equilibrium can be rationalized by a cognitive hierarchy model.", "date": "2010-12-15", "date_type": "published", "publisher": "Economic Research Institute (EFI), Stockholm School of Economics", "id_number": "CaltechAUTHORS:20110215-080914315", "official_url": "https://resolver.caltech.edu/CaltechAUTHORS:20110215-080914315", "rights": "No commercial reproduction, distribution, display or performance rights in this work are provided.", "funders": { "items": [ { "agency": "Jan Wallander and Tom Hedelius Foundation" }, { "agency": "National Science Council (Taipei)", "grant_number": "98-2410-H-002-069-MY2" }, { "agency": "National Science Council (Taipei)", "grant_number": "99-2410-H-002-060-MY3" }, { "agency": "NSF" }, { "agency": "Human Frontier Science Program" }, { "agency": "Gordon and Betty Moore Foundation" } ] }, "primary_object": { "basename": "hastef0671_1_.pdf", "url": "https://authors.library.caltech.edu/records/0gwev-06x98/files/hastef0671_1_.pdf" }, "related_objects": [ { "basename": "hastef0671.appendix.pdf", "url": "https://authors.library.caltech.edu/records/0gwev-06x98/files/hastef0671.appendix.pdf" } ], "resource_type": "monograph", "pub_year": "2010", "author_list": "\u00d6stling, Robert; Wang, Joseph Tao-yi; et el." }, { "id": "https://authors.library.caltech.edu/records/gp7p4-2ry54", "eprint_id": 22815, "eprint_status": "archive", "datestamp": "2023-08-19 00:47:43", "lastmod": "2024-01-13 00:11:14", "type": "monograph", "metadata_visibility": "show", "creators": { "items": [ { "id": "Tanaka-T", "name": { "family": "Tanaka", "given": "Tomomi" } }, { "id": "Camerer-C-F", "name": { "family": "Camerer", "given": "Colin F." }, "orcid": "0000-0003-4049-1871" }, { "id": "Nguyen-Quang", "name": { "family": "Nguyen", "given": "Quang" } } ] }, "title": "Measuring Norms of Income Transfers: Trust Experiments and Survey Data from Vietnam", "ispublished": "unpub", "full_text_status": "public", "note": "This research was supported by a Behavioral Economics Small Grant from the Russell Sage\nFoundation, Foundation for Advanced Studies on International Development, and internal Caltech funds (CFC).\nComments from participants at the ESA meeting (Tucson, October 2005), SEA meeting (November 2005), SJDM\n(November 2005), audiences at Columbia, NYU, Bocconi (Milano), Emory, Hawaii, Caltech, UCSC, and\nanonymous referees were helpful. Thank you to our research coordinators, Phan Dinh Khoi, Huynh Truong Huy,\nNguyen Anh Quan, Nguyen Mau Dung, and research assistants, Bui Thanh Sang, Nguyen The Du, Ngo Nguyen\nThanh Tam, Pham Thanh Xuan, Nguyen Minh Duc, Tran Quang Trung, and Tran Tat Nhat. We also thank Nguyen\nThe Quan, the General Statistical Office, for allowing us to access the 2002 household survey data.\n\nPublished - ssrn-id1642530_1_.pdf
", "abstract": "This paper compares the patterns of income transfers within village communities in the north and\nsouth of Vietnam by analyzing household survey and experimental data. The results of\nhousehold data analysis show private transfers flow from high-income households to low-income\nhouseholds in the south where social safety net is limited. In contrast, private transfers do not\ncorrelate with pre-transfer income in the north where public transfers are more widespread. In\naddition, public transfers crowd out private transfers in the north. We conducted a trust game in\nboth regions and found consistent results. People in the south are more altruistic toward the poor:\nthey send more to the poor without expecting higher repayment. This pattern is consistent with\nthe idea that private norms of redistribution from rich to poor are active in the south, but are\ncrowded out in the north, possibly by communist public institutions, although we observe higher\nlevels of trust and reciprocity in the north.", "date": "2009-12-02", "date_type": "published", "publisher": "California Institute of Technology", "id_number": "CaltechAUTHORS:20110310-145856119", "official_url": "https://resolver.caltech.edu/CaltechAUTHORS:20110310-145856119", "rights": "No commercial reproduction, distribution, display or performance rights in this work are provided.", "funders": { "items": [ { "agency": "Russell Sage Foundation Behavioral Economics Small Grant" }, { "agency": "Foundation for Advanced Studies on International Development" }, { "agency": "Caltech" } ] }, "primary_object": { "basename": "ssrn-id1642530_1_.pdf", "url": "https://authors.library.caltech.edu/records/gp7p4-2ry54/files/ssrn-id1642530_1_.pdf" }, "resource_type": "monograph", "pub_year": "2009", "author_list": "Tanaka, Tomomi; Camerer, Colin F.; et el." }, { "id": "https://authors.library.caltech.edu/records/bvphy-wk925", "eprint_id": 22790, "eprint_status": "archive", "datestamp": "2023-08-19 00:24:42", "lastmod": "2024-01-13 00:11:06", "type": "monograph", "metadata_visibility": "show", "creators": { "items": [ { "id": "Brocas-I", "name": { "family": "Brocas", "given": "Isabelle" } }, { "id": "Carrillo-J-D", "name": { "family": "Carrillo", "given": "Juan D." } }, { "id": "Wang-Stephanie-W", "name": { "family": "Wang", "given": "Stephanie W." } }, { "id": "Camerer-C-F", "name": { "family": "Camerer", "given": "Colin F." }, "orcid": "0000-0003-4049-1871" } ] }, "title": "Measuring Attention and Strategic Behavior in Games with Private Information", "ispublished": "unpub", "full_text_status": "public", "note": "Support of LUSK Center (IB), the Office of the Provost at USC and the Microsoft Corporation\n(JDC), HFSP, NSF and Moore Foundation grants (CFC) and Moore Foundation (SWW) is gratefully\nacknowledged. Yi Zhu provided excellent research assistance. Mousetracking was developed by Chris\nCrabbe and Walter Yuan as an extension to their Multistage program. We are very grateful for their\nremarkable combination of enthusiasm and speed. Helpful comments were received from audiences at USC\nLaw, Moore Foundation Retreat (March 09), ESA Washington 2009, Stanford SITE 2009, Southampton\nand Edinburgh.\n\nSubmitted - ssrn-id1496997_1_.pdf
", "abstract": "In experiments, people do not always appear to think very strategically or to infer the information of others from their choices. We report experimental results in games of private information with three information states, which vary in strategic complexity. \"Mousetracking\" is used to record which game payoffs subjects look at, for how long, to learn more about the thinking process. Subjects often deviate from Nash equilibrium choices, converge only modestly toward equilibrium across 40 trials, and often fail to look at payoffs which they need to in order to compute an equilibrium response. Theories such as QRE and cursed equilibrium, which can explain nonequilibrium choices, are not well supported by the combination of both choices and lookups. When cluster analysis is used to group subjects according to lookup patterns and choices, the clusters appear to correspond approximately to level-3, level-2 and level-1 thinking in level-k cognitive hierarchy models. The connection between looking and choices is strong enough that the time durations of looking at key payoffs can predict choices, to some extent, at the individual level and at the trial-by-trial level.", "date": "2009-10-27", "date_type": "published", "publisher": "California Institute of Technology", "id_number": "CaltechAUTHORS:20110310-084608792", "official_url": "https://resolver.caltech.edu/CaltechAUTHORS:20110310-084608792", "rights": "No commercial reproduction, distribution, display or performance rights in this work are provided.", "funders": { "items": [ { "agency": "LUSK Center" }, { "agency": "University of Southern California" }, { "agency": "Microsoft Corporation" }, { "agency": "Human Frontier Science Program" }, { "agency": "NSF" }, { "agency": "Gordon and Betty Moore Foundation" } ] }, "collection": "CaltechAUTHORS", "primary_object": { "basename": "ssrn-id1496997_1_.pdf", "url": "https://authors.library.caltech.edu/records/bvphy-wk925/files/ssrn-id1496997_1_.pdf" }, "resource_type": "monograph", "pub_year": "2009", "author_list": "Brocas, Isabelle; Carrillo, Juan D.; et el." }, { "id": "https://authors.library.caltech.edu/records/7da3z-kby87", "eprint_id": 99363, "eprint_status": "archive", "datestamp": "2023-08-19 00:00:45", "lastmod": "2024-01-14 22:00:21", "type": "monograph", "metadata_visibility": "show", "creators": { "items": [ { "id": "Brunner-C", "name": { "family": "Brunner", "given": "Christoph" } }, { "id": "Camerer-C-F", "name": { "family": "Camerer", "given": "Colin F." }, "orcid": "0000-0003-4049-1871" }, { "id": "Goeree-J-K", "name": { "family": "Goeree", "given": "Jacob K." }, "orcid": "0000-0001-9876-3425" } ] }, "title": "A Correction and Re-Examination of \"Stationary Concepts for Experimental 2 x 2 Games\"", "ispublished": "unpub", "full_text_status": "public", "keywords": "stationary concepts, quantal response, action-sampling,\npayoff-sampling, impulse balance", "note": "We would like to thank participants at the Economic Science\nAssociation meetings in Tucson (November, 2008) for valuable feedback. We gratefully acknowledge\nfinancial support from the National Science Foundation (SES 0551014), the Gordon and Betty Moore\nFoundation, and the European Research Council (ERC Advanced grant, ESEI-249433).\n\nPublished - iewwp437.pdf
Accepted Version - ssrn-id1688964_1_.pdf
", "abstract": "Reinhard Selten and Thorsten Chmura (2008) recently reported laboratory results for completely mixed 2 x 2 games used to compare Nash equilibrium with four other stationary concepts: quantal response equilibrium, action-sampling equilibrium, payoff-sampling equilibrium, and impulse balance equilibrium. We reanalyze their data, correct some errors, and find that Nash clearly fits worst while the four other concepts perform about equally well. We also report new analysis of\nother previous experiments that illustrate the importance of the loss aversion hardwired into impulse balance equilibrium: when the other non-Nash concepts are augmented with loss aversion, they outperform impulse balance equilibrium.", "date": "2009-09", "date_type": "published", "publisher": "Institute for Empirical Research in Economics", "id_number": "CaltechAUTHORS:20191018-104338444", "official_url": "https://resolver.caltech.edu/CaltechAUTHORS:20191018-104338444", "rights": "No commercial reproduction, distribution, display or performance rights in this work are provided.", "funders": { "items": [ { "agency": "NSF", "grant_number": "SES 0551014" }, { "agency": "Gordon and Betty Moore Foundation" }, { "agency": "European Research Council (ERC)", "grant_number": "ESEI-249433" } ] }, "doi": "10.5167/uzh-51889", "primary_object": { "basename": "iewwp437.pdf", "url": "https://authors.library.caltech.edu/records/7da3z-kby87/files/iewwp437.pdf" }, "related_objects": [ { "basename": "ssrn-id1688964_1_.pdf", "url": "https://authors.library.caltech.edu/records/7da3z-kby87/files/ssrn-id1688964_1_.pdf" } ], "resource_type": "monograph", "pub_year": "2009", "author_list": "Brunner, Christoph; Camerer, Colin F.; et el." }, { "id": "https://authors.library.caltech.edu/records/vae61-jbj77", "eprint_id": 22100, "eprint_status": "archive", "datestamp": "2023-08-19 22:12:01", "lastmod": "2023-10-23 15:41:14", "type": "monograph", "metadata_visibility": "show", "creators": { "items": [ { "id": "Sonnemann-U", "name": { "family": "Sonnemann", "given": "Ulrich" } }, { "id": "Camerer-C-F", "name": { "family": "Camerer", "given": "Colin F." }, "orcid": "0000-0003-4049-1871" }, { "id": "Fox-C-R", "name": { "family": "Fox", "given": "Craig R." } }, { "id": "Langer-T", "name": { "family": "Langer", "given": "Thomas" } } ] }, "title": "Partition-dependent framing effects in lab and field prediction markets", "ispublished": "unpub", "full_text_status": "public", "keywords": "prediction markets, framing effects", "note": "We thank Justin Wolfers for providing the economic derivatives market data used in Section IV, audiences at Toronto (JDM meeting 2005), Muenster (July 2007), Mannheim (June 2006), Caltech (May 2007), Rome (ESA 2007), Warsaw (SPUDM 2007), and Chicago (October 2007). Thanks to Sera Linardi for feedback. This research was supported by the DFG-grant LA1316/3-1, NSF grant (CRF), the Moore Foundation, NSF-HSD and HSFP grants (CFC).\n\nSubmitted - SCFL-PartitionDependence_in_PredictionMarkets_vers_2_22_08_1_.pdf
Supplemental Material - SCFL_Appendix_II_1_.pdf
Supplemental Material - SCFL_Appendix_VIII_1_.pdf
", "abstract": "Many psychology experiments show that individually judged probabilities of the same event can vary depending on the partition of the state space (a framing effect called \"partition-dependence\"). We show that these biases transfer to competitive prediction markets in which multiple informed traders are provided economic incentives to bet on their beliefs about events. We report results of a short controlled lab study, a longer field experiment (betting on the NBA playoffs and the FIFA World Cup), and naturally-occurring trading in macro-economic derivatives. The combined evidence suggests that partition-dependence can exist and persist in lab and field prediction markets.", "date": "2008-02-22", "date_type": "published", "publisher": "University of Muenster", "id_number": "CaltechAUTHORS:20110209-161226104", "official_url": "https://resolver.caltech.edu/CaltechAUTHORS:20110209-161226104", "rights": "No commercial reproduction, distribution, display or performance rights in this work are provided.", "funders": { "items": [ { "agency": "Deutsche Forschungsgemeinschaft (DFG)", "grant_number": "LA1316/3-1" }, { "agency": "NSF" }, { "agency": "Gordon and Betty Moore Foundation" }, { "agency": "Human Frontier Science Program" } ] }, "primary_object": { "basename": "SCFL_Appendix_VIII_1_.pdf", "url": "https://authors.library.caltech.edu/records/vae61-jbj77/files/SCFL_Appendix_VIII_1_.pdf" }, "related_objects": [ { "basename": "SCFL-PartitionDependence_in_PredictionMarkets_vers_2_22_08_1_.pdf", "url": "https://authors.library.caltech.edu/records/vae61-jbj77/files/SCFL-PartitionDependence_in_PredictionMarkets_vers_2_22_08_1_.pdf" }, { "basename": "SCFL_Appendix_II_1_.pdf", "url": "https://authors.library.caltech.edu/records/vae61-jbj77/files/SCFL_Appendix_II_1_.pdf" } ], "resource_type": "monograph", "pub_year": "2008", "author_list": "Sonnemann, Ulrich; Camerer, Colin F.; et el." }, { "id": "https://authors.library.caltech.edu/records/z2yps-45c20", "eprint_id": 21988, "eprint_status": "archive", "datestamp": "2023-08-19 21:19:53", "lastmod": "2024-01-13 00:09:19", "type": "monograph", "metadata_visibility": "show", "creators": { "items": [ { "id": "\u00d6stling-R", "name": { "family": "\u00d6stling", "given": "Robert" } }, { "id": "Wang-J-T-Y", "name": { "family": "Wang", "given": "Joseph Tao-yi" } }, { "id": "Chou-Eileen-Y", "name": { "family": "Chou", "given": "Eileen" } }, { "id": "Camerer-C-F", "name": { "family": "Camerer", "given": "Colin F." }, "orcid": "0000-0003-4049-1871" } ] }, "title": "Field and Lab Convergence in Poisson LUPI Games", "ispublished": "unpub", "full_text_status": "public", "keywords": "Population uncertainty, Poisson game, QRE, congestion game, guessing\ngame, experimental methods, behavioral game theory, cognitive hierarchy", "note": "The first two authors, Joseph Tao-yi Wang and Robert \u00d6stling, contributed equally to this paper. We\nare grateful for helpful comments from Tore Ellingsen, Magnus Johannesson, Botond K\u00f6szegi, David Laib-\nson, Erik Lindqvist, Stefan Molin, Noah Myung, Rosemarie Nagel, Charles Noussair, Carsten Schmidt,\nDmitri Vinogradov, Mark Voorneveld, J\u00f6rgen Weibull, seminar participants at California Institute of\nTechnology, Stockholm School of Economics, Mannheim Empirical Research Summer School 2007, and\nUC Santa Barbara Cognitive Neuroscience Summer School 2007. Robert \u00d6stling acknowledges financial\nsupport from the Jan Wallander and Tom Hedelius Foundation. Colin Camerer acknowledges support\nfrom the NSF HSD program, HSFP, and the Betty and Gordon Moore Foundation.\n\nPublished - LUPI_final2_1_.pdf
Updated - Limbo17_1_.pdf
", "abstract": "In the lowest unique positive integer (LUPI) game, players pick positive integers and the\nplayer who chose the lowest unique number (not chosen by anyone else) wins a fixed\nprize. We derive theoretical equilibrium predictions, assuming fully rational players with\nPoisson-distributed uncertainty about the number of players. We also derive predictions\nfor boundedly rational players using quantal response equilibrium and a cognitive hierarchy of rationality steps with quantal responses. The theoretical predictions are tested\nusing both field data from a Swedish gambling company, and laboratory data from a\nscaled-down version of the field game. The field and lab data show similar patterns: in\nearly rounds, players choose very low and very high numbers too often, and avoid focal\n(\"round\") numbers. However, there is some learning and a surprising degree of convergence toward equilibrium. The cognitive hierarchy model with quantal responses can\naccount for the basic discrepancies between the equilibrium prediction and the data.", "date": "2007-10-30", "date_type": "published", "publisher": "Caltech Library", "id_number": "CaltechAUTHORS:20110203-144706555", "official_url": "https://resolver.caltech.edu/CaltechAUTHORS:20110203-144706555", "rights": "No commercial reproduction, distribution, display or performance rights in this work are provided.", "funders": { "items": [ { "agency": "NSF Human and Social Dynamics (HSD) program" }, { "agency": "Human Frontier Science Program (HSFP)" }, { "agency": "Gordon and Betty Moore Foundation" } ] }, "primary_object": { "basename": "LUPI_final2_1_.pdf", "url": "https://authors.library.caltech.edu/records/z2yps-45c20/files/LUPI_final2_1_.pdf" }, "related_objects": [ { "basename": "Limbo17_1_.pdf", "url": "https://authors.library.caltech.edu/records/z2yps-45c20/files/Limbo17_1_.pdf" } ], "resource_type": "monograph", "pub_year": "2007", "author_list": "\u00d6stling, Robert; Wang, Joseph Tao-yi; et el." }, { "id": "https://authors.library.caltech.edu/records/d3pak-spm30", "eprint_id": 21993, "eprint_status": "archive", "datestamp": "2023-08-19 16:24:22", "lastmod": "2024-01-13 00:09:21", "type": "monograph", "metadata_visibility": "show", "creators": { "items": [ { "id": "Ho-Teck-Hua", "name": { "family": "Ho", "given": "Teck H." }, "orcid": "0000-0001-5210-4977" }, { "id": "Lim-Noah", "name": { "family": "Lim", "given": "Noah" } }, { "id": "Camerer-C-F", "name": { "family": "Camerer", "given": "Colin F." }, "orcid": "0000-0003-4049-1871" } ] }, "title": "Modeling the Psychology of Consumer and Firm Behavior\n with Behavioral Economics", "ispublished": "unpub", "full_text_status": "public", "note": "Posted 9/23/05.\nThis research is partially supported by NSF Grant SBR\n9730187. We thank Wilfred Amaldoss, Botond Koszegi, George Loewenstein, John Lynch, Robert Meyer,\nDrazen Prelec, and Matt Rabin for their helpful comments. We are especially grateful to the late journal\neditor, Dick Wittink, for inviting and encouraging us to undertake this review. Dick was a great supporter\nof inter-disciplinary research. We hope this review can honor his influence and enthusiasm by spurring\nresearch that spans both marketing and behavioral economics.\n\nPublished - JMRFinal_1_.pdf
", "abstract": "Marketing is an applied science that tries to explain and influence how firms and\nconsumers actually behave in markets. Marketing models are usually applications of\neconomic theories. These theories are general and produce precise predictions, but they\nrely on strong assumptions of rationality of consumers and firms. Theories based on\nrationality limits could prove similarly general and precise, while grounding theories in\npsychological plausibility and explaining facts which are puzzles for the standard\napproach.\nBehavioral economics explores the implications of limits of rationality. The goal is to\nmake economic theories more plausible while maintaining formal power and accurate\nprediction of field data. This review focuses selectively on six types of models used in\nbehavioral economics that can be applied to marketing.\nThree of the models generalize consumer preference to allow (1) sensitivity to reference\npoints (and loss-aversion); (2) social preferences toward outcomes of others; and (3)\npreference for instant gratification (quasi-hyperbolic discounting). The three models are\napplied to industrial channel bargaining, salesforce compensation, and pricing of virtuous\ngoods such as gym memberships. The other three models generalize the concept of gametheoretic\nequilibrium, allowing decision makers to make mistakes (quantal response\nequilibrium), encounter limits on the depth of strategic thinking (cognitive hierarchy),\nand equilibrate by learning from feedback (self-tuning EWA). These are applied to\nmarketing strategy problems involving differentiated products, competitive entry into\nlarge and small markets, and low-price guarantees.\nThe main goal of this selected review is to encourage marketing researchers of all kinds\nto apply these tools to marketing. Understanding the models and applying them is a\ntechnical challenge for marketing modelers, which also requires thoughtful input from\npsychologists studying details of consumer behavior. As a result, models like these could\ncreate a common language for modelers who prize formality and psychologists who prize\nrealism.", "date": "2005-09-23", "date_type": "published", "publisher": "UCLA Department of Economics", "id_number": "CaltechAUTHORS:20110203-154203041", "official_url": "https://resolver.caltech.edu/CaltechAUTHORS:20110203-154203041", "rights": "No commercial reproduction, distribution, display or performance rights in this work are provided.", "funders": { "items": [ { "agency": "NSF", "grant_number": "SBR 9730187" } ] }, "primary_object": { "basename": "JMRFinal_1_.pdf", "url": "https://authors.library.caltech.edu/records/d3pak-spm30/files/JMRFinal_1_.pdf" }, "resource_type": "monograph", "pub_year": "2005", "author_list": "Ho, Teck H.; Lim, Noah; et el." }, { "id": "https://authors.library.caltech.edu/records/gx834-53y75", "eprint_id": 22027, "eprint_status": "archive", "datestamp": "2023-08-19 10:25:41", "lastmod": "2023-10-23 15:37:16", "type": "monograph", "metadata_visibility": "show", "creators": { "items": [ { "id": "Camerer-C-F", "name": { "family": "Camerer", "given": "Colin F." }, "orcid": "0000-0003-4049-1871" }, { "id": "Ho-Teck-Hua", "name": { "family": "Ho", "given": "Teck-Hua" }, "orcid": "0000-0001-5210-4977" }, { "id": "Chong-Juin-Kuan", "name": { "family": "Chong", "given": "Juin Kuan" }, "orcid": "0000-0002-5187-8652" } ] }, "title": "A cognitive hierarchy theory of one-shot games: Some preliminary results", "ispublished": "unpub", "full_text_status": "public", "note": "This research was supported by NSF grant SES-0078911. This draft is not intended for publication.\nIt simply summarizes a variety of results in a format accessible to interested readers through web-based archiving. Thanks to C. M\u00f3nica Capra, Haitao Cui, Paul Glimcher, and Roger Myerson. Former math nerd Matthew Rabin directed our attention to the golden ratio. Ming Hsu and Brian Rogers provided\nexcellent research assistance. Useful comments were received from seminars at Caltech, Chicago, New\nYork University, Pittsburgh, the Nobel Symposium in Sweden (December 2001), Columbia, and Berkeley.\n\nPublished - QJE1202a_1__short_ver.pdf
Published - qjefinal6_1__revised_short_ver.pdf
Published - thinking2002_1_.pdf
Submitted - ssrn-id411061_1_.pdf
Supplemental Material - pBC_Data.zip
", "abstract": "Strategic thinking, best-response, and mutual consistency (equilibrium) are three\nkey modelling principles in noncooperative game theory. This paper relaxes mutual\nconsistency to predict how players are likely to behave in in one-shot games before they\ncan learn to equilibrate. We introduce a one-parameter cognitive hierarchy (CH) model\nto predict behavior in one-shot games, and initial conditions in repeated games. The CH\napproach assumes that players use k steps of reasoning with frequency f (k). Zero-step\nplayers randomize. Players using k (\u2265 1) steps best respond given partially rational\nexpectations about what players doing 0 through k - 1 steps actually choose. A simple\naxiom which expresses the intuition that steps of thinking are increasingly constrained by\nworking memory, implies that f (k) has a Poisson distribution (characterized by a mean\nnumber of thinking steps \u03c4 ). The CH model converges to dominance-solvable equilibria\nwhen \u03c4 is large, predicts monotonic entry in binary entry games for \u03c4 < 1:25, and predicts\neffects of group size which are not predicted by Nash equilibrium. Best-fitting values of\n\u03c4 have an interquartile range of (.98,2.40) and a median of 1.65 across 80 experimental\nsamples of matrix games, entry games, mixed-equilibrium games, and dominance-solvable\np-beauty contests. The CH model also has economic value because subjects would have\nraised their earnings substantially if they had best-responded to model forecasts instead\nof making the choices they did.", "date": "2002-12-06", "date_type": "published", "publisher": "Caltech Library", "id_number": "CaltechAUTHORS:20110204-144123593", "official_url": "https://resolver.caltech.edu/CaltechAUTHORS:20110204-144123593", "rights": "No commercial reproduction, distribution, display or performance rights in this work are provided.", "funders": { "items": [ { "agency": "NSF", "grant_number": "SES-0078911" } ] }, "primary_object": { "basename": "QJE1202a_1__short_ver.pdf", "url": "https://authors.library.caltech.edu/records/gx834-53y75/files/QJE1202a_1__short_ver.pdf" }, "related_objects": [ { "basename": "pBC_Data.zip", "url": "https://authors.library.caltech.edu/records/gx834-53y75/files/pBC_Data.zip" }, { "basename": "qjefinal6_1__revised_short_ver.pdf", "url": "https://authors.library.caltech.edu/records/gx834-53y75/files/qjefinal6_1__revised_short_ver.pdf" }, { "basename": "ssrn-id411061_1_.pdf", "url": "https://authors.library.caltech.edu/records/gx834-53y75/files/ssrn-id411061_1_.pdf" }, { "basename": "thinking2002_1_.pdf", "url": "https://authors.library.caltech.edu/records/gx834-53y75/files/thinking2002_1_.pdf" } ], "resource_type": "monograph", "pub_year": "2002", "author_list": "Camerer, Colin F.; Ho, Teck-Hua; et el." } ]